Jason Sandford
Jason Sandford is a reporter, writer, blogger and photographer interested in all things Asheville.
BizJournals.com has the story. If you’ll recall, former Asheville Citizen-Times marketing manager Luann Labedz just left Asheville for the post of publisher of Atlanta’s Creative Loafing a few months ago. Luann, I hope you’re surviving this.
With a $40 million loan default looming, Creative Loafing Inc., the parent company of a local alternative weekly in Atlanta of the same name, filed for Chapter 11 bankruptcy protection Monday.
According to the filing with the U.S. Bankruptcy Court’s Middle District of Florida, Creative Loafing reported estimated assets of between $10 million and $50 million and liabilities of the same amount.
The bankruptcy filing comes the same day Creative Loafing sued Atalaya Administrative LLC, Atalaya Funding II LP and BIA Digital Partners SBIC II LP asking a judge to stop a default on $40 million loan. In the suit, filed with the same court, Creative Loafing said the lenders failed to act in good faith when they refused to negotiate lowering the financial covenants. Without the injunction, Creative Loafing says it has no other options in stopping the default, as it would be “too late to save the debtors’ businesses, reputation, and close-knit and effective management.”
Wayne Garcia, a political and media reporter for the Tampa publication, said in his blog Creative Loafing decided to file for protection as a result of a slowing economy as well as an exacerbation of debts caused by the 2007 purchase of Chicago Reader and Washington City Times.
Creative Loafing chief executive Ben Eason told the company’s staff from his Tampa office Monday that his company “has cash” and that it’s actually not a “cash issue,” according to Garcia’s report.
“This is not a management issue. It’s strictly the economy tanking.”
Creative Loafing will survive. It will be bought by the Asheville Citizen Times and the staff there will have to soak up all of the added work load. Yes, all of it.
Yeah Yeah It’s The Gannett Way!!!!
No statement on Creative Loafing, which and whom I have enjoyed and still respect, but I’m starting to wonder how many defaulting businesses will use our "signs of the times" or "current crises" as easy excuses for failing? It’s honorable to fail; it’s not honorable to deflect responsibility. A good product, at a fair price, delivered with good service and a mutual sense of gratitude is all that was ever needed to run the world. Honest businesses should have been safe, but what the hell, now maybe they’re not? There’s been poison. I beg the gurus for guidance.