Thursday, April 24, 2014
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S. Donald Sussman
Brodsky said, "The board of directors has been looking for an investment partner who shares our commitment to MaineToday Media and is willing to invest in a modern, broadly supported growth strategy. We have found our partner in Donald Sussman and Maine Values LLC, and we are confident our employees, readers and business partners will be pleased."
Brodsky said the board will hire a top-notch chief executive with media experience. In the interim, Neil Heyside will be appointed CEO.
Heyside is a senior executive who leads the Performance Improvement practice for CRG Partners, a New York City firm that helps media companies and other industries restructure their operations.
A native of the United Kingdom who has worked with businesses around the world, Heyside has spent considerable time with MaineToday Media since last year, helping to develop a business plan to expand the company's Internet products and services for readers and advertisers.
Heyside said his goal will be to make the company the leading media organization in every community it serves.
"MTM is transitioning from a legacy newspaper print company to a multi-platform community media company," Heyside said in a prepared statement. "MTM will not only be positioned for sustained growth, but will also be a solid platform for developing other revenue streams. With investment in editorial resources and content creation, it will be strongly positioned to enhance further the quality of its print and online products."
The business plan developed by Heyside and management has the strong backing of The Portland Newspaper Guild, which represents many of the employees. Tom Bell, a Portland Press Herald staff writer and the president of the Guild, said union members are supportive of the new partnership with Maine Values LLC.
"Our members are partial owners of MaineToday Media through our employee stock ownership program," said Bell. "We have worked hard in partnership with management and the board of directors to help shape a plan to modernize our technology and strengthen this business. We are encouraged that Maine Values LLC supports that plan and is providing the resources to fund it."
The pending deal follows a period of consolidation and uncertainty for MaineToday Media.
In October, declining advertising revenue for the Press Herald led to 61 job cuts and buyouts, many of them in the newsroom. Those cuts were followed late in the month by the departure of Richard Connor, CEO of the company.
Connor, a Bangor native, was the catalyst for buying the distressed newspapers from The Seattle Times Co. in 2009. Connor left after undisclosed management conflicts with MaineToday Media's board.
The company's majority owner, Texas-based HM Capital Partners, then put the operation up for sale. Under the new financial arrangement, the private equity firm will remain the majority owner.
The new financing will make the company solvent again. MaineToday Media has an outstanding loan with a regional bank, RBS Citizens N.A. According to Sussman, debt has been renegotiated and will be made current with part of his proceeds.
The new money also will help the company pay other creditors, Sussman said, and the business plan being put in effect aims to make the company profitable.
The pending deal with Sussman ends a previous effort by other parties to purchase and operate MaineToday Media.
Last month, a group of investors that included media executive Chris Harte, a former Press Herald president, and Aaron Kushner, a businessman who two years ago tried to buy The Boston Globe, signed a letter of intent to become the majority owner of MaineToday Media.
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