Judge extends creditor protection for SaltWire newspapers
Lawyers say they hope to determine path forward by new deadline of May 3
A Nova Scotia judge has extended creditor protection to the SaltWire group of newspapers for another seven weeks. But the judge is also asking for more information before he'll sign off on the plan lawyers are proposing to help the company restructure.
SaltWire owns newspapers in Newfoundland, Nova Scotia and Prince Edward Island. It has debts of more than $60 million and revenues of only a fraction of that amount.
The company was first granted creditor protection on an emergency basis last week. Lawyers returned to court Friday to try to formalize a plan to move the matter forward.
Justice John Keith of the Nova Scotia Supreme Court wanted clarification on the roles and powers the various players involved in the restructuring will have. The lawyers promised to supply him with that information before the case returns to court on Monday.
Real-estate holdings
The discussion included the fate of buildings which housed some of the newspapers.
The St. John's Telegram building in the Newfoundland city and the Cape Breton Post building in Sydney are both for sale. The lawyers agreed the buildings could be sold as standalone transactions and didn't have to be included in the sale of SaltWire assets.
Headline Promotional Products, a separate company under the SaltWire umbrella that sells promotional items like apparel and novelty items, is being wound down, putting 10 people out of work. Headline lost $350,000 last year.
One complication in the restructuring process is the role of Mark Lever. He's the current head of SaltWire and he's expressed an interest in making a bid to buy the restructured company.
During Friday's hearing, lawyers discussed how to make sure Lever did not get an unfair advantage over other potential bidders by obtaining insider information about rival bids. Justice Keith stressed that the precautions would be for any member of the current management team, not just Lever, to ensure there was no appearance of bias.
The next deadline for creditor protection is May 3. The lawyers told the judge they hoped to have a better idea of the path forward by then.
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