New York Tabloids in Deadly Fight : Media: Two money-losing newspapers trade charges about finances.
Like a pair of bloodied prizefighters, the New York Daily News and the New York Post traded charges about each other’s financial health Tuesday in the latest volley in a long-running tabloid war that one or both will likely lose.
The News, in an article headlined “POST IS CRYING FOR CASH,” reported that its rival’s publisher, Peter S. Kalikow, “is scrambling for $5 million to help the tabloid pay its bills.” The article was accompanied by a photo of Kalikow--who entered Chapter 11 bankruptcy proceedings last August--with his hand out.
“The story is beneath contempt,” a Post spokesman responded, adding that the credit line being sought is for nothing more significant than “seasonal financing.”
And Kalikow himself, in a pointed jab at the Maxwell family-owned Daily News, added: “The Post’s only source of funds is its circulation and advertising revenue. I won’t and can’t steal from my pension funds.” Kalikow was quoted to the same effect in Tuesday’s editions of the Post.
The News joined Kalikow in Chapter 11 two weeks ago, and the Post has delighted in the days since in questioning the optimistic pronouncements of News spokesmen.
Investigators are looking into reports that up to $25 million of the hundreds of millions that its late publisher, Robert Maxwell, plundered from pension funds was used to prop up the paper, once the nation’s largest metropolitan daily.
“This has got to be unique in the annals of American journalism: A newspaper in bankruptcy proceedings and a publisher in bankruptcy proceedings using their news staffs to dig up dirt on one another,” said James Ledbetter, media columnist for the weekly Village Voice.
Cheering them on the sidelines is New York Newsday, the only tabloid in the marketplace with deep pockets and modern color presses. Newsday, like the Los Angeles Times, is published by Times Mirror Co.
Documents on file in Kalikow’s personal bankruptcy case confirm that the publisher has asked for court permission to lend $5 million in court-protected funds to the Post. Observers said the paper’s financial needs, while not dire, indicate that the Post would be hard pressed to revive a Sunday edition to compete with Newsday if the News goes out of business.
In related moves Tuesday:
* Maxwell Communication Corp., parent of U.S. publishing giant Macmillan, sought court-appointed administrators in Britain. The firm, with debts of $2.5 billion, similarly sought court protection under Chapter 11 Monday in New York.
* The Financial Times reported that Maxwell Communication’s 43 bank lenders were furious that it sought bankruptcy protection and were seeking to have their own receiver appointed to run the firm.
* Berlitz International Inc., of which Maxwell Communication owns 56%, said it may take a charge against two notes totaling almost $125 million issued by Maxwell Communication. Berlitz also suspended dividends on its 7% non-cumulative preferred shares.
* The chairman of a British parliamentary committee probing Maxwell pension funds said he would compel Maxwell’s sons, Kevin and Ian, to testify Jan. 13. Both declined invitations to testify voluntarily.
* Moody’s Investors Service downgraded $514 million in junk-grade debt of Maxwell Communication and two of its subsidiaries.