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Wednesday, March 20, 2024
Star-Advertiser Sold to Carpenter Media -- after paying $150K ransom
By Selected News Articles @ 4:22 PM :: 1865 Views :: First Amendment

35 Washington State News Publications Sold to a Mysterious New Owner

from Seattle Post Alley, March 19, 2024 (excerpts)

A British Columbia court last week approved the sale of the Canadian company that owns the Everett Herald and 34 other local news outlets in Washington, as well as the Honolulu Star-Advertiser and other newspapers in Hawaii. The deal is expected to close on Friday, March 22….

The new ownership structure is opaque. The new company, oddly called 1000817790 Ontario Ltd., will take control of the Washington and Hawaii news outlets; newspapers in Alaska including the Juneau Empire; and about 100 newspapers, almost all weeklies, in western Canada. The deal emerged from a months-long bankruptcy and bidding process that slogged through the Supreme Court of British Columbia and U.S. Bankruptcy Court in Delaware for two months….

Purchaser 1000817790 Ontario Ltd. is controlled by the investors represented by Canso and Deans Knight. Minority partner Carpenter Media will actively manage the newspapers, and it seems likely that Carpenter Media will be the brand visible to the public. That’s about all that is publicly known about the new owners. None of the parties has commented much about the future except through statements promising journalism-as-usual. It’s hard to imagine there will be no changes, cuts, or closures. But Carpenter, which today owns 28 small newspapers, will have its hands full just swallowing the far greater Black Press holdings.

So what happens next at Sound Publishing, the Black Press subsidiary that owns the Everett Herald and other, smaller news outlets in Washington, is still unclear. Court documents indicate there will be unspecified Black Press layoffs before the deal closes on Friday. In the U.S., the federal Worker Adjustment and Retraining Notification (WARN) Act requires companies with more than 100 workers to give 60 days notice before mass terminations. No such notice is on file with the Washington Employment Security Department. But the WARN requirement might not apply in the case of a chain of newspapers with multiple job sites….

Meanwhile, something unexpected made the cost of the transaction rise: The Hawaii properties of Black Press (BP Hawaii) were hit by a January ransomware attack that froze crucial computer systems. “While BP Hawaii was still able to produce its publications following the Cyber Incident,” a court document says, “the encryption of the affected servers impacted BP Hawaii’s ability to issue invoices to advertisers and subscribers. This adversely affected BP Hawaii’s cashflow by approximately US $200,000 per day.”

These days, companies routinely negotiate such ransoms, and the firm hired by Black Press to do so managed to get the initial $4 million demand reduced to $150,000. “The estimated total cost of the Cyber Incident, including a full forensic audit of the breach and identification and implementation of necessary fixes, is between US $300,000 and US $750,000.” Those are among the expenses covered by the $11.5 million (Canadian) bridge loan….

read … 35 Washington State News Publications Sold to a Mysterious New Owner

CB: The Sunshine Blog: The Star-Advertiser Paid A $150K Ransom. In Bitcoin 

ILind: News about the newspaper 

SA: Carpenter Media completes purchase of Star-Advertiser parent

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