Saturday, November 8, 2008

Cash Crunch at NYT; $400 Million Due in May

Henry Blodgett reports that

... the company must deliver $400 million to lenders in May of 2009, six months from now. The company has only $46 million of cash on hand, and its operations will likely begin consuming this meager balance this quarter or next. The company has been shut out of the commercial paper market, but has a $366 million short-term credit line remaining that it entered into several years ago, when the industry was strong. It has not yet drawn this cash down, and given the current environment and the trends at the company, we would not take for granted that it will be able to do so.

Blodgett notes that this doesn't mean bankruptcy for NYT, but merely that it may have to sell assets to survive.

But, if the NYT can't sell assets in time, will Treasury step in and buy commercial paper from NYT? Thus extending the bailout to MSM companies? And, just how tough will NYT be on the bailout, if they become part of it?

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