The Tribune Company filed today for Chapter 11 bankruptcy protection, due to mounting debt and an inability to pay interest in the floundering economy, the Wall Street Journal reports. Tribune’s profits declined 83% in the third quarter, making it difficult to finance $12 billion in debt. The company has employed lawyers and financial advisers expert in assisting newspapers in trouble.
The company—which owns the Chicago Tribune, Los Angeles Times and other papers—is responsible for a $1 billion payment this year, and more than $500 million by June 2009. Owner Sam Zell hoped to finance the debt by selling key assets, but the credit crisis and loss of confidence have stymied efforts, the Tribune adds. “Factors beyond our control have created a perfect storm,” he said.