The New York Post reports today that Star Tribune owner Avista Capital Partners “has asked creditors to delay its debt payments for six months” as it cuts costs and restructures.
According to Post reporter Zachery Kouwe, creditors aren’t eager to comply: they want Avista to pump in $50 million of its own money first. The company recently wrote down its initial $100 million investment to $25 million, so it probably isn’t eager to surrender more cash. Strib chairman Chris Harte didn’t return calls, Kouwe notes.
The Post obviously has good sources in the New York financial community, but has overreached in the past.
Last month, Kouwe broke the news that Avista had hired the New York-based Blackstone Group to negotiate with creditors. However, he also reported in the May 4 dispatch that the company had failed to meet debt obligations — something Avista specifically denied. The Post later walked back the repayment-failure claim.
Blackstone declined comment for today’s piece.
The new Post story comes amid the backdrop of ongoing labor discussions with the Strib’s newsroom and production unions. The Strib’s newsroom contract expires July 31. After the Post’s original bankruptcy story broke, Guild co-chair Graydon Royce pronounced the timing “a bit curious.”