Oakland Tribune Says It May Be Forced to Fold

Oakland Tribune publisher Robert C. Maynard, bitterly accusing media giant Gannett Co. of “killing” his troubled newspaper, said Thursday that the daily would be forced to close next Wednesday if Gannett does not change its position on a debt repayment.

Maynard said an unidentified investor had agreed to pump desperately needed capital into the paper. But the deal required Gannett, which sold the paper to Maynard in 1983, to accept $2.5 million as full repayment for the $31.5 million it is owed by the Tribune.

The paper has been on the brink of bankruptcy for many months despite extensive staff reductions and pay cuts it negotiated with its unions.

Maynard said other potential investors had been unwilling to make any payments to Gannett. He asserted that the debt was worth nowhere near the $6 million to $8 million he said Gannett was demanding.

“The amount we have offered exceeds exceeds the net proceeds Gannett could expect to receive from the liquidation of the Tribune’s assets,” the publisher said in a statement.

Arlington, Va.-based Gannett responded in a statement that it had “never received a bona fide offer from any investor,” and that Maynard had refused to provide details of the repayment offer.

Gannett said the Tribune had been in default on the loan “for at least five years” but reiterated its commitment not to take any action that would put the Tribune into bankruptcy.

But the Tribune lacks the cash for daily operations and is in arrears with other creditors, according to some staff members. Maynard’s public airing of his dispute with Gannett appeared to some in the industry as a last-ditch effort to wring concessions from the firm--the publisher of USA Today and many other papers--and thus pave the way for a cash infusion.

The 117-year-old Tribune has a circulation of 121,500 copies a day, a 19% drop from about 150,000 in 1987. Employment is about 600 people, down from about 725 last year. The paper has suffered from a weak economy in Oakland, competition from suburban newspapers and the broad advertising slump that has affected many publications around the country.

If it closes, it would leave Oakland as the top U.S. city without its own daily newspaper.