S&P Cuts McClatchy Bonds to Junk Status

Editor and Publisher ^ | April 27, 2007 | E&P Staff

[mdittmar]

CHICAGO The McClatchy Co.'s bonds slid from investment grade into relatively deep junk status as Standard & Poor's Ratings Services (S&P) downgraded the nation's third-biggest newspaper chain two steps to "BB-plus."

S&P's "BB-plus" rating judges a company's debt to have "significant speculative characteristics."

S&P had rated McClatchy bonds an investment grade "BBB," but last month issued a credit watch and suggested it could downgrade its bonds by one step.

The deeper ratings cut followed McClatchy's announcement last week that first-quarter profits declined 67%, and that revenues were down 5% on a same-property basis.

The S&P downgrade will increase McClatchy's interest payment on existing debt by $1.8 million annually, the company's CFO, Pat Talamantes told its flagship paper, The Sacramento Bee, in an article by staff writer Dale Kasler.

McClatchy took on considerable debt to finance its acquisition last summer of Knight Ridder Inc.

In noon trading on the New York Stock Exchange, McClatchy (MNI) was down 56 cents or 1.88%, at $29.30.

[ConservativeMind]

Ping to you, sir.

[Tribune7]

ping

[Doctor Raoul]

Raoul's First Law of Journalism

BIAS = LAYOFFS

[Enterprise]

Mega bump to Raoul’s law! (Makes me shed a tear for McClatchy. sniff sniff!)

[Milhous]

With both put options already in the money how much further can MNI fall? Will yet another billionaire with more money than sense ride to the rescue to stop this plunge?

PUT OPTIONS

Expire at close Fri, May 18, 2007

Strike	Symbol	Last	Chg	Bid	Ask	Vol	Open Int
30.00	MNIQF.X	0.95	0.10	0.95	1.10	7	300
35.00	MNIQG.X	4.90	0.00	5.50	5.90	10	152

---

[hsalaw]

Is that the smell of dead dinosaur in the air?

[WilliamofCarmichael]

Well when their "flagship" newspaper comes out within hours of 9/11/01 and says that it was our fault -- we share the blame -- because we don't try to understand the rest of the world what do they expect?

Last time I looked at anything to do with the Bee (two years ago, I think) they still say we share the blame.

Within weeks of 9/11/01 the publisher of the Bee was booed off the stage at a local university for siding with accused terrorists against President Bush and then Attorney General Ashcroft.

Bee employees joined with CAIR against Mark Williams who was eventually kicked off a local radio station.. well what the hell do they expect?

[Milhous]

Is that the smell of dead dinosaur in the air?

[hsalaw]

Heh.

[Frank_2001]

Actually it’s not the bonds that are junk; it’s most of what’s in the papers;)

[hsalaw]

I cancelled my subscription to the Sacramento Bee about six years ago. When I moved to a new house a year ago, I got a call from them, asking me to subscribe. I told them I wasn’t interested, and, when they asked why, I said “because I’m a conservative Republican and you’re a liberal rag.” I haven’t heard from them since.

[dighton]

The McClatchy Co.’s bonds slid from investment grade into relatively deep junk status as Standard & Poor’s Ratings Services (S&P) downgraded the nation’s third-biggest newspaper chain two steps to “BB-plus.”

Bee papers plunging towards bee-minus.

[CarmichaelPatriot]

They tried delivering me “samples” in an attempt to get me to subscribe. I called them and told them to come pick up their trash from my driveway and not to ever contaminate my property again. They haven’t bothered me since.

[BCrago66]

The bonds’ status matches the status of McClatchy’s reporting on Iraq: Junk.

[WilliamofCarmichael]

RE: "They tried delivering me “samples” in an attempt to get me to subscribe. I called them and told them to come pick up their trash from my driveway and not to ever contaminate my property again. They haven’t bothered me since."

I had the same experience. When it was there again the next day I called and simply told them that I had not subscribed, they replied in a happy voice that it was free for the next two weeks. I told them to stop it. I did not want it.

I am not exaggerating, they responded with an irritated / angry voice, "Have a nice day" and disconnected. It was probably one of their "reporters" doing extra duty, I hope.

I figured that they were getting a lot of calls. Good.