Herald files for bankruptcy, plans sale to GateHouse
Boston Herald Publisher Patrick J. Purcell announced yesterday that the media company with its flagship Boston Herald newspaper has reached an agreement with GateHouse Media LLC for it to acquire the company’s operational assets. The purchase is subject to court approval.
The announcement came as Purcell gathered management and staff in the Herald newspaper’s office on Fargo Street in Boston’s Seaport District. He spoke first with his longtime management team and then with staff from across all departments.
In a simultaneous letter to employees, Purcell wrote: “I am very proud of the spectacular management team with whom I have worked hand in hand over the years. And I am equally as proud of the excellent staff in all areas of our company who have worked tirelessly to make the Boston Herald a relevant and respected provider of local and regional news for Boston and the area.
“Boston is a better city for the Herald’s unique and fearless local reporting. Because of all of you, we are well known for our influential political, community, business and sports coverage across the region and beyond.”
Boston Herald Inc. (BHI), hindered like many other newspapers with significant pension and retirement liabilities as well as declining revenue with the onset of digital media and a growing variety of news originators and aggregators, had some 900 employees at its peak in 2000. Today it has 240; more than 120 of them work in the newsroom.
BHI filed a voluntary Chapter 11 bankruptcy petition yesterday in the District of Delaware to maximize the value of the company and its assets by selling the business as a going concern under the supervision of the Bankruptcy Court.
The company contemplates that the sale will allow the operation to continue, providing the greatest stability for employees, customers and vendors; as well as the best return to unsecured creditors.
State and city leaders reacted to the news.
“The Boston Herald has long been a revered Massachusetts institution. Its scrappy, tenacious report has helped foster vital and relevant dialogue for decades,” House Speaker Robert A. DeLeo said last night. “I am concerned about the loss of good jobs and I hope that new ownership maintains the Herald’s commitment to telling our communities’ stories.”
Attorney General Maura Healey tweeted, “Best to my friends at @BostonHerald. You’ve been telling important stories for a generation — keep up the good, hard work. Journalism has never been more important to us all.”
City Councilor Tito Jackson said, “Very sorry to hear the sad news about my friends, staff at the @bostonherald. #Boston is a much better city with the @bostonherald. 2 papers are better than 1. We need your voice, veracity and vigor. Sending my best wishes to all the staff.”
U.S. Rep. Joseph P. Kennedy III wrote, “The @bostonherald reporters are some of the toughest and finest out there. Hoping this city can count on their voice for years to come. Right now we need journalists. We need newspapers. We need people willing to ask the hard questions. #MaPoli.”
Purcell told employees gathered that the company would continue its day-today operations, providing breaking news to its daily newspaper readers and online consumers as usual.
Purcell, in his letter to employees, also explained, “In addition to great news and advertising coverage for our dedicated readers over the years, all I ever wanted to do was keep the Boston Herald alive. And it is with this pending sale that I am able to do that in these difficult newspapering times.”
Purcell was named publisher in 1984 by Rupert Murdoch when News Corp. owned the paper. Ten years later, Purcell bought the newspaper and remains publisher today.
GateHouse Media, headquartered in Pittsford, N.Y., is one of the largest publishers of locally based media in the United States. In Massachusetts alone, it publishes the Worcester Telegram & Gazette, the Cape Cod Times, The Patriot Ledger and more than 100 other weekly and daily newspapers.
By filing for bankruptcy protections, and even with a purchase agreement with GateHouse, the court requires BHI to hold an auction to allow all potential buyers an opportunity to submit competing offers.