On February 13, 2020, we announced that we commenced a restructuring under Chapter 11 of the U.S. Bankruptcy Code to provide McClatchy with immediate protection while we pursue approval of our proposed restructuring plan and work to definitively address the Company’s funded debt, strengthen our balance sheet, and address our pension obligations moving forward.
We initiated this process following active restructuring negotiations with the Pension Benefit Guaranty Corporation (PBGC), the federal agency that guarantees benefits under McClatchy’s qualified pension plan, and our largest secured creditor to address the future of our pension obligations and capital structure, which were previously disclosed in the Company’s press release dated November 13, 2019 and extended as part of McClatchy’s January 15, 2020 standstill agreement with the PBGC.
On July 24, 2020, we announced that we filed an asset purchase agreement with the U.S. Bankruptcy Court, formalizing the details of Chatham Asset Management’s successful bid for ownership of McClatchy in the Chapter 11 sale process. Among other terms, the agreement outlines that the entirety of the 30 McClatchy news organizations will move seamlessly to the new ownership structure. The filing is a key milestone in the reorganization process and paves the way for a change in control of our 163-year-old news company.
Throughout this process, we continue to maintain the same unwavering commitment to delivering strong, independent journalism that is essential to our local communities. Our finances continue to be sufficient to fund McClatchy’s operations, even amid the extraordinary circumstances posed by the unfolding COVID-19 pandemic and associated global economic challenges.
We believe the actions we have taken are an important step to ensure a strong future for McClatchy and will provide greater certainty and stability to our stakeholders that benefit from a restructured McClatchy, including our qualified pension plan participants, employees, and readers. As a result of this process, we expect to be even better positioned to advance our digital transformation and continue delivering essential local news to our subscribers and readers in the communities we serve.
We are committed to keeping our stakeholders updated throughout this process. Through this website, which is being updated regularly, you have access to additional information, FAQs, and other resources to help you better understand this process.
Chief Executive Officer, McClatchy