Banks Closing in on TCH

JTMan

Looks like the Sunday Business Post might be on its last legs ...

Sunday Business Post owners face bank crunch

http://www.independent.ie/business/irish/business-post-owners-face-bank-crunch-3358069.html

THOMAS Crosbie Holdings, owners of The Examiner and The Sunday Business Post, is edging closer to making a tough decision on its financial restructuring. Grant Thornton, the accountants, have been advising the company on what it needs to do since last summer.

TCH management are now weighing the various options facing the group from reducing costs further to taking more radical action. Tom Murphy, the chief executive of TCH, did not return calls for comment.

TCH's main bank, AIB, is owed more than €25m and the company has seen its turnover fall sharply in its most recent accounts to January 2011 from €82.5m to €70.8m. Turnover for the group peaked at €113m in 2006.

sataction

The sunday market looks to be in real trouble. SBP is a good newspaper but is only 10c less than Sunday Times hard to justify the purchase without a sports section. Sunday newspapers are too expensive and too big. We need a concise read for €2 or less. The SBP magazine could easily be got rid of. All newspapers should be tabloid in size.

IRE60

This will clarify the Sunday Market!

channelsurfer2

Even the sunday times has reduced its content signficantly. the news section is now only 12 to 14 actual pages(news review is included now in itto bring last sundays first section to a grant total of 24 pages). It used to be up to 32 pages at one time excluding the news review section.

JTMan

channelsurfer2 wrote: »

Even the sunday times has reduced its content signficantly. the news section is now only 12 to 14 actual pages(news review is included now in itto bring last sundays first section to a grant total of 24 pages). It used to be up to 32 pages at one time excluding the news review section.

Yeah and it is this kind of cost cutting that reduces a papers quality that then feeds the ongoing circulation declines.

Sponge Bob

John Gormley ( former minister) twittering about this subject tonight.

https://twitter.com/JohnGormley/status/298143057520492545

I won't retwitter or republish any of it, make your own mind up.

JTMan

John, 24 hours later, has deleted his tweet.

Somethings up at TCH.

Sponge Bob

Maybe Gormley was tweeting your OP from months ago Fungus and then he realised he was way behind the curve.

mike65

People might say the Sundays have been killed by internet and recession but I think its 24 hr news on tv that's done it. For actual news the Sundays are so far behind the curve its nearly embarrassing at times. While proper detailed analysis is expensive and rare.

The beefed up Saturdays are another reason. I'll say that in 10 years the Sunday paper will be dead.

IRE60

We have to hold on for another two weeks while TCH, IN&M and the IT Trust get their collective fingers out and publish their 6 month ABC's.

The fact that it will be the end of Feb when they do finally publish says something about their attitude to a modern information age society.

Anyway, since 2000 the Sundays are down 25% as opposed to 17% for the Daily market (who's splitting hairs!!)

I'd say aside for the interweb I think the Sunday market has been a product of its own success in the past - it was deemed a 'Sabbath' style day and papers were purchased by the new time - and I allude to a day when multiple purchases were made of papers.

I’d say that’s one reason for there more rapid fall

The argument of the lack of any decent news analysis also is a factor.

Loafing Oaf

Well some sort of deal has been done:


http://www.rte.ie/news/business/2013/0306/374490-thomas-crosbie-holdings/

A receiver has been appointed to TCH, and seemingly simultaneously, the Crosbies have set up a new company to buy most of the assets back from the receiver. Looks like they might be trying to detach themselves from the SBP though.


Maybe someone with a better business head than me could try to read between the lines on this...

amenable

Its called a pre-pack. You appoint a receiver but before its done you set up another vehicle to buy the company or some parts of it. The 'to be appointed' receiver may know the company is 'pre-packaged' and is part of the process. It can be viewed as boarder line legal in terms of the Companies Act but has become not an infrequent event, particularly in the UK. It has been tolerated in recent times because the reality of doing business in the recession has given rise to the view that saving some jobs, and possibly a viable future for the business, makes this otherwise unpalatable practice easier to stomach.

Questions arise as to whether or not the process is designed to ensure certain creditors of the company get burnt and the old owners re-emerge with a debt free business with all the deadwood cut adrift.

On the face of it, this seems not be the case here as all staff on the assets acquired in the transaction are transferring with the sale.

However the examinership of the SBP will make it vulnerable to a 'fire-sale' process and if the old owners go in for it, they'll probably get a bargain and lose some baggage to boot.

This is a smart strategy. You buy the bits that are viable (not much risk here), let the delinquent parts go (the printing operation, removes an overhead) and then let an attractive but risky bit of the old empire get battered in the wind before picking it up for a much reduced price and then administer a little TLC to ensure you gain a tasty morsel to re-bolt on the new mothership.

End game is the same business but without the bad bits. Only risk for the new owners is that someone else takes a fancy to the SBP and they lose it. In the overall scheme of things this is not a significant factor.

Be interesting to see if any creditors (revenue?) get left behind. Does anyone know what the SBP was turning over? Circulation is, I believe, sub 40,000.

Loafing Oaf

amenable wrote: »

Its called a pre-pack. You appoint a receiver but before its done you set up another vehicle to buy the company or some parts of it. The 'to be appointed' receiver may know the company is 'pre-packaged' and is part of the process. It can be viewed as boarder line legal in terms of the Companies Act but has become not an infrequent event, particularly in the UK. It has been tolerated in recent times because the reality of doing business in the recession has given rise to the view that saving some jobs, and possibly a viable future for the business, makes this otherwise unpalatable practice easier to stomach.

Questions arise as to whether or not the process is designed to ensure certain creditors of the company get burnt and the old owners re-emerge with a debt free business with all the deadwood cut adrift.

On the face of it, this seems not be the case here as all staff on the assets acquired in the transaction are transferring with the sale.

However the examinership of the SBP will make it vulnerable to a 'fire-sale' process and if the old owners go in for it, they'll probably get a bargain and lose some baggage to boot.

This is a smart strategy. You buy the bits that are viable (not much risk here), let the delinquent parts go (the printing operation, removes an overhead) and then let an attractive but risky bit of the old empire get battered in the wind before picking it up for a much reduced price and then administer a little TLC to ensure you gain a tasty morsel to re-bolt on the new mothership.

End game is the same business but without the bad bits. Only risk for the new owners is that someone else takes a fancy to the SBP and they lose it. In the overall scheme of things this is not a significant factor.

Be interesting to see if any creditors (revenue?) get left behind. Does anyone know what the SBP was turning over? Circulation is, I believe, sub 40,000.

Thanks for the info. You'd have to wonder even with this bit of financial smoke and mirrors what the future is for either the Examiner or the SBP with their plummeting circulation. Vincent Browne plaintively asserting there has to be a future for a paper like the SBP with its great cadre of journalists. Noreen Hegarty on the panel could have told him that didn't save the Tribune, with higher circulation and lower staff numbers...

IRE60

@amenable**: Thanks for the ‘pre-pack’ background, it looks like, as other areas would call it, a Bed and Breakfast!

Divested of all the parts in the business that may have been a difficulty, now free to continue to publish a myriad of titles and broadcast to thousands…. and save 500+ jobs. hp days.

I still feel that the printing contract in the TCH drama is a smoke screen, considering they owned part (how much ?) of that business.

The SBP left swinging into examinership also leaves me thinking

** @amenable: “Hat tip” to the take on the above, honest – but first post, I’m guarded.

Loafing Oaf

And here's the SBP end of the deal:

http://www.irishtimes.com/newspaper/breaking/2013/0307/breaking3.html

Have to say it looks bleak to my untrained eye. If 'Landmark' aren't going to take them back would anyone else conceivably be interested?

Chips Lovell

The Sunday Business Post wasn't sold by the receiver because AIB didn't have security over it, hence the examinership. Landmark are believed to want to buy it out of examinership. Danger for the Crosbies is if someone else comes along with a better offer.

As the Irish Times reported this morning:

It is understood the Sunday newspaper was excluded from the Landmark deal as AIB, TCH’s main lender, did not have a charge over its assets.

Landmark and Mr Crosbie are expected to seek to acquire the Sunday title from the examiner.

mike65

The big danger is that they don't go to press on Saturday afternoon. Thats 40 hours away.

Chips Lovell

Is it? Why?

Loafing Oaf

Vladimir Kurtains wrote: »

Is it? Why?

Received wisdom is it would deliver a fatal blow to the paper's image among consumers and advertisers. Looking at the figures again though, the whole thing seems pretty hopeless: losing over a million a year, revenue halved since 2007...Maybe the examiner should just put it out of its misery, let the staff get on with rebuilding their careers somewhere else.

Chips Lovell

Was referring to his suggestion that it won't go to press this weekend, rather than the long term health. Court heard yesterday that it had funding to continue to trade for the entire examinership period and it has a new print deal with the Times, so I don't think there's any risk it won't appear.

Loafing Oaf

Vladimir Kurtains wrote: »

Was referring to his suggestion that it won't go to press this weekend, rather than the long term health.

So was I in my first sentence. I thought you were expressing skepticism that missing publication for an issue or two would be such a catastrophe for the SBP.

Chips Lovell

Ah, getcha now. Sorry for any misunderstanding. Agree that missing publication would be catastrophic.

IRE60

All the titles had a few things in common -

The SBP too many staff (76 and 120 contribs!), that has to be slimmed down.

A collapse in advertising across the market: Recruitment, autos and Property would have hit the SBP.

But, a lot hangs around the contract with Webprint Concepts which the Examiner got out or and the SBP are going to in they get examinership. It seem form the reading that the price per unit was high and for a fixed term.

A small aside: The examiner started printing in the Irish Times Print Pant on Thursday night - i.e. immediately.

I've been on the very sharp end of pre-press more than once and can announce to the world that it's no joke moving presses and then reorganising your prepress, press and distribution (which is the other end of the country now for the examiner).
The was serious planning in this, not something you'd do on the back of a fag packet.

But, and here's the kicker: up to six months ago TCH could not have printed on the IT presses without redesigning all of their titles to fit the larger web width used then by the IT.

But then IT redesigned and re-configured to a 'standard' press - same size as used by TCH...........

Could it be that (perhaps) the third biggest print contract in the State THC publications) dangled in front of the slightly impoverished IT then they 'took the soup' - reconfigure their press and paper to facilitate that contract.

A musing only.

flogen

Loafing Oaf wrote: »

Looking at the figures again though, the whole thing seems pretty hopeless: losing over a million a year, revenue halved since 2007...Maybe the examiner should just put it out of its misery, let the staff get on with rebuilding their careers somewhere else.

I wouldn't be so negative.

The eventual buyer will have a bit more room for manoeuvre than might have been possible pre-examinership.

Moving the printing contract to something cheaper (like the Examiner has done) would be one move, as would transferring operations into the buyer's offices.

From that can come plenty of what businesspeople like to call "synergies", in other words unifying what had been duplicated services (payroll, admin, sales, reception etc).

The SBP has also been very much distinct from The Examiner, editorially, despite being part of the same media group.

The Guardian and Observer used to be similarly distinct, but in recent times the divide has started to come down.

If the new buyer decides to follow suit and turn the SBP into the Sunday edition of whatever daily newspaper they own, that could also yield savings.

IRE60 wrote: »

But, and here's the kicker: up to six months ago TCH could not have printed on the IT presses without redesigning all of their titles to fit the larger web width used then by the IT.

But then IT redesigned and re-configured to a 'standard' press - same size as used by TCH...........

Could it be that (perhaps) the third biggest print contract in the State THC publications) dangled in front of the slightly impoverished IT then they 'took the soup' - reconfigure their press and paper to facilitate that contract.

A musing only.

Interesting thought.

To be honest I'd find it hard to believe that the IT would change its format just to bag a print contract, though. I'm more inclined to believe that it was done to make the newspaper a bit more attractive (by being easier to read) as well as that bit cheaper to produce.

That being said, if they were aware of this contract coming down the tracks it's sure to have added an extra incentive to switch.

JTMan

60 jobs are now under threat at WebPrint Technologies.

Exactly who is printing this Sundays edition of the SBP? Is it the IT like with the former TCH titles?

Chips Lovell

Irish Times is printing it.

IRE60

Vladimir Kurtains wrote: »

Irish Times is printing it.

IT are printing all the 'Landmark' titles as of Thursday - as TCH divested itself of the Webprint Consepts contract under liquidation.

However, SBP is not in Rec/exam therefore they are contractually obliged to print in WC - that would be my understanding of it legally. If they don't print there - is there a breach of contract (and does that matter at this point) ?

JTMan

I though Post Publications had a contract with Thomas Crosbie Printers Ltd. Thomas Crosbie Printers Ltd in turn had a contract with WebPrint.

Thomas Crosbie Printers Ltd are in liquidation. Hence, maybe this frees Post Publications up to use the IT for printing.

IRE60

Good point - its a very complex setup.

I suppose the outcome will be that TCH saves 500+ jobs - the SBP will keep a proposed 50 odd - Web Concepts might not have a bright future - but, in the hue and cry, it's a positive number on the jobs front.

Finally I 'quipped' earlier about the SBP having 120 contribs - but i read now they are unsecured creditors - I hope something can be done to secure payment for them

JTMan

The Sunday Times are reporting that WebPrint are suing the Irish Times, Thomas Crosbie Holdings and AIB over breach of contract. Should be an interesting case.

IRE60

Yea! TCH is now an empty shell and suing the recipient of the new contract is clutching at straws.

JTMan

Yeah, it is inconceivable that WebPrint will succeed.

WebPrint are suing for 20 million EUR !!

IRE60

Fungus wrote: »

Yeah, it is inconceivable that WebPrint will succeed.

WebPrint are suing for 20 million EUR !!

I can well believe that - the value of future contracts that are now gone.
Another consideration; paper is a comoddity product - especially newsprint. You can't really ring somebody and order next weeks supplies in a thursday! Is a massive project. Many companies 'buy forward' and buy, today, six months paper in advance.
Trees are felled, grinded and pulp and paper produced - on the back of those orders (I'm simplifying the process!) web concepts I suggest would have bought forward and they will be held to those contracts by the paper companies.
So that's a second sting for concepts

amenable

Examinerships a good way get round upward only rent reviews. 600k in arrears on rent. 200k rent reduction, 250k print savings. Add 25 redundancies and you've got the 1m annual loss licked. Not convinced about the 'techical error' on the bank lean re title as thereason as to why sbp didn't transfer with other assets. I find the post re the print planning and switch to IT persuasive. It is clear they've planning this for months. Checking the lean on the sbp title would have been part of the planning process. If it wasn't in place, perfecting same wouldn't have been a problem. We're looking at a process where optics need to be convincing. I guess they've taken a view that not looking too clever for their own good by leaving sbp flapping in the wind draws attention away from the rest of the deal. No doubt the restructured group will be a regional player and maybe sbp not key to that future. It's puzzling alright. Seems to be good interest in the title but at what price? Inm valued €20m. Will Crosby be going in at a few hundred grand? Low ball it too much and the risk of losing greater. But they are gambling that one anyway. Expect a low bid from the corkonians. will anyone else even bother. Inm at 4 cent per share tonight.

Loafing Oaf

Looking now like a joint venture between Landmark and the Irish Times will be taking over the SBP. You have to wonder how much business sense this makes for the Times, which is hardly in a massively strong financial position itself, and whether they wouldn't be better off launching their own Sunday title.

IRE60

I don’t think is a particularly bad move for the IT. The SBP is an established brand (whatever you think of it is another thing). The IT looked at a Sunday some time back but didn't move on it. They could bring a lot of synergies and cost savings to the current SBP structure and it could well wash its face.
The IT would probably beef up the news and might even introduce a bit of Sport. The market for a ‘business Sunday’ is 40,000k and heading south, there is a bigger market when you broaden the papers appeal.

JTMan

According to the ST, the IT will not rebrand the SBP. A sure fire way to not broaden its base.

Loafing Oaf

Fungus wrote: »

According to the ST, the IT will not rebrand the SBP. A sure fire way to not broaden its base.

Yeah you would have thought a change to the Sunday Business Times or such would be in order. Keeping the name makes rebranding that much harder I'd imagine...

Tombo2001

Fungus wrote: »

According to the ST, the IT will not rebrand the SBP. A sure fire way to not broaden its base.

They wont rebrand it, but the content will surely change (ie improve).

There is a good synergy between the Irish Times and the SPB in that the SPB is the only existing Sunday title that can be called a serious newspaper......that in itself is a major synergy......in other words there is crossover journalistically.

Loafing Oaf

Tombo2001 wrote: »

They wont rebrand it, but the content will surely change (ie improve).

There is a good synergy between the Irish Times and the SPB in that the SPB is the only existing Sunday title that can be called a serious newspaper......that in itself is a major synergy......in other words there is crossover journalistically.

I was about to say I still don't see where this is a superior prospect to just launch an IT on Sunday, but if the Times didn't make this bid, the SBP would keep going (for a while anyway) under different management and the gap in the market wouldn't be there, so I guess there is a tide in the affairs of men and all that...

sataction

A new launch for "Times on Sunday" would be very expensive. The SBP has an existing readership with a demographic similar to the Times. They can change it over time, introducing sport and changing the name to The Sunday Post. Also they can make use of its daily email digest to business users.

JTMan

The Sindo are reporting today that Landmark Media have pulled out of bidding for the SBP.

There are 2 other parties who are interested in the SBP.

IRE60

That would be worrying! The Crosbies obviously couldn't do deal with some/all creditors for amke the business viable.

I was only thinking on Friday that the examiner said the previous week that a final decision would be made last week - which didn't happen, so that in itself was a bad sign.

JTMan

It is a bad sign.

Time will tell if either of the other 2 bidders want to burn cash on this niche declining old media newspaper.

IRE60

Regardless of what you think of the I.T. 'Sunday' - they, as a business, would have brought some great cost savings to the table.. Advertising/Circulation/distribution/printing etc (plus sport is they wanted it)

Sunny Disposition

Would be good if the IT took it on, and started a sport section. SBP is an excellent paper apart from the lack of sports coverage.

JTMan

Has anyone heard anything new about how the SBP examinership process is going? It is nearing an End.

IRE60

Funny - since the Landmark deal fell through there has been absolutely not a word.
I assume the other two parties are still interested. But, IMO, "something is rotten in the state of Denmark". Something is stalling the issue and my money would be a possible breach of contract with the printers

?

C

JTMan

The Indo had an article on this last week. Apparently there are still 3 bidders left but they want to see cost cuts first. 10 jobs to go by Friday coming. Soon Cliff Taylor will write the whole paper by himself!

Post Publications are running to the wire/deadline with selling this old media loss-making niche newspaper.

Loafing Oaf

Fungus wrote: »

The Indo had an article on this last week. Apparently there are still 3 bidders left but they want to see cost cuts first. 10 jobs to go by Friday coming. Soon Cliff Taylor will write the whole paper by himself!

Do we know if the Times (minus the Crosbies) is one of the three?

I still say an Irish Times on Sunday is a better business proposition than any revamped SBP, but only if the SBP is taken out of the market.

So I wonder could the Times possibly reach on off the record deal with the examiner: you let the SBP go to the wall and we'll have a Sunday paper out before the end of the year, with many SBP staff on board....

JTMan

The Irish Times Trust have definitely pulled out. The Irish Times Trust are in serious financial difficulty and do not have the financial resources to purchase a newspaper.