Owner of the Orange County Register, Freedom Communications Inc., filed for bankruptcy this past Halloween weekend in a management-led plan to acquire the failing newspaper company. Freedom’s publisher and CEO, Rich Mirman, has gotten together with local investors and filed for bankruptcy this past Sunday in an attempt to reorganize the O.C. Register’s finances. Mirman has been in control of the day-to-day operations for the Orange County Register for around a year to date.
As reported by the newspaper, Mr. Mirman and his team of investors hope the bankruptcy proceedings will help reorganize the debts incurred since investors Aaron Kushner and Eric Spitz bought the company three years ago. This bankruptcy plan is designed to put an end Kushner’s ownership stake in Freedom Communications Inc., but still allowing Mr. Spitz to remain an investor and company chairman.
“We’re turning the page and starting a new chapter,” Mirman said. “We’ve gone through a few rocky years, and we need to redefine ourselves.”
O.C. Register’s Bold Moves Backfired
Kushner and Spitz originally saw success when they took over the Register in July 2012. Together the men expanded sections of the paper, launched the Long Beach Register, and eventually bought the Press-Enterprise for $27 million in late 2013.
While employing a complete overhaul of how the newspaper was run, Spitz and Kushner also dramatically increased subscription costs while almost completely eliminating web publishing. Unfortunately, according the the Register, losses mounted and the owners turned to layoffs. Things got worse for Spitz and Kushner, they were eventually were forced to pursue buyouts and implement staff furloughs in 2014.
Media Consultant Alan Mutter put the new ownership’s situation into words,
“There was all these sort of shoot-from-the-hip initiatives that puzzled everybody that thinks they know anything about the state of the newspaper business.”
Competition for Orange County’s News?
Freedom spokesman Eric Morgan stated Rich Mirman goals were to refocus on the Register’s “core markets” and that there was “a sharp focus back to digital,” with hopes to increase the O.C. Register’s online presence.
Mirman has admitted that his bankruptcy case isn’t a sure-thing. Other bidders, including Tribune Publishing, owner of the Los Angeles Times, may emerge to bid on the struggling newspaper. Tribune Publishing has stated that purchasing newspapers in nearby markets is one of their goals, creating the California News Group after procuring the San Diego Union-Tribune.
By uniting the major newspapers from Los Angeles to San Diego, Tribune Publishing could save a significant amount of overhead costs by sharing advertising and print operations, media analyst Ken Doctor reported.