ANCHORAGE, Alaska >> A federal bankruptcy judge today approved the sale of Alaska’s largest newspaper for $1 million, saving the paper from folding.
Judge Gary Spraker made his decision after hearing hours of testimony over the financial liabilities of the Alaska Dispatch News.
In approving the sale, Spraker said it was the best option available — better than liquidation — despite his concerns over the fast pace of the process.
The new owner of the Anchorage newspaper is the Binkley Co., a family owned firm in Fairbanks. Ryan Binkley and Alaska Media’s Jason Evans are currently co-publishers of the newspaper and intend to keep it going.
The judge noted he had to bite his tongue to keep from asking why the buyer believed it could be successful in what has been a money-losing venture.
Former publisher Alice Rogoff bought the Anchorage Daily News for $34 million from The McClatchy Co. in 2014. Since then, the renamed paper has been losing about $500,000 a month and entered bankruptcy on Aug. 12.
A bid of $1 million was submitted by the Binkley Co. and there also is a long list of creditors involving about $12.5 million in debt.
During Monday’s hearing, Rogoff was asked during her testimony if she thought the $1 million sale price was fair.
“No, but it’s my only offer,” she said.
A handful of other prospective buyers had indicated interest, but no one else submitted a formal offer, she said.
Binkley said after the hearing that the family is happy about the outcome, but indicated to Anchorage television station KTUU that layoffs would likely occur among the staff of more than 200 people. He also said creditors would likely see little or no money on work they had performed for Rogoff.
The new owners have brought in former Anchorage Daily News publisher Jerry Grilly as a consultant as they attempt to turn around the finances. Grilly also was president of the Denver Post before he retired.
Cabot Christianson, Rogoff’s attorney, was also happy about the outcome.
“We sold the paper,” he said, leaving the courthouse. “That’s what we wanted.”
A hearing was scheduled for Sept. 22 to consider a U.S. trustee’s motion involving attempts to recover more than $2 million that creditors claim is owed to them in unsecured debt, said their attorney, Mike Mills.
In August, the judge approved a $1 million loan from Binkley for the newspaper to keep it operating as negotiations continued. In Monday’s testimony, involved parties said that money has been depleted.
The newspaper used the loan to pay insurance premiums and employees. Without the loan, Alaska Dispatch News could not afford its ongoing expenses and would have to fold, Christianson has said.
The Anchorage-based newspaper filed for bankruptcy on Aug. 12.
Last week, a judge and Northrim Bank allowed Alaska Dispatch News to move $800,000 out of its account to pay newspaper carriers and another $50,000 to pay workers compensation, insurance premiums and employee reimbursements while hearings for its sale were delayed.