Richard Verstegan 5 a.m., March 12
Several Big U.S. Cities Could Be without Daily Newspapers by 2010, Says Rating Agency
Fitch Ratings, which provides ratings on various investments, said this week that several cities could be without daily print newspapers by 2010. Fitch rates the bonds of both McClatchy and Tribune as junk. Fitch expects newspaper defaults and closures in 2009. The rating agency is negative on media in general, but most downbeat on newspapers. Today (Dec. 4), E.W. Scripps put the Rocky Mountain News and its 50 percent stake in the Denver Newspaper Agency up for sale. The owner of the other half of the agency is MediaNews, owned by William Dean Singleton, who has been rumored to be a candidate to buy the Union-Tribune, although he, too, is very deeply in debt. Scripps says that its half of the Denver Newspaper Agency cash flow is no longer enough to support the Rocky Mountain News -- a blow for Singleton and his Post. Landmark Communications yesterday pulled the Norfolk Virginia-Pilot off the market. Cox is still trying to sell papers including the one in Austin, Texas. Stock of GateHouse Media, which bought Copley Press's Midwest papers in 2007, wound up today at 8 cents today. It was around $17 at the time of the transaction. The money for that deal was forwarded by Fortress Investment Group, which then controlled more than half of GateHouse. Fortress has fallen on hard times. After it suspended redemptions in a hedge fund, its stock fell to $1.89. Stock of heavily-indebted Lee Enterprises, which owns the North County Times, closed at 60 cents today. Copley Press put the U-T up for sale in July.