UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 1, 2017
The McClatchy Company
(Exact name of registrant as specified in its charter)
DELAWARE |
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1-9824 |
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52-2080478 |
(State or other jurisdiction of |
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(Commission |
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(I.R.S. Employer |
2100 Q Street
Sacramento, CA 95816
(Address of principal executive offices, zip code)
Registrants telephone number, including area code (916) 321-1846
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.
On September 1, 2017, The McClatchy Company (the Company) approved the voluntary transfer of the listing of the Companys Class A common stock (Class A Common Stock) to the NYSE American LLC (NYSE American) from the New York Stock Exchange (NYSE). The Companys Class A Common Stock has been approved for listing on the NYSE American and will commence trading on the NYSE American on September 12, 2017, under the Companys current symbol MNI. The Companys Class A Common Stock will cease trading on the NYSE at the end of the trading day on September 11, 2017.
Item 8.01 Other Events.
On September 7, 2017, the Company issued a press release announcing the sale of The Sacramento Bees building and surrounding land in Sacramento, California and The Kansas City Stars office building and land for total gross proceeds of $56.75 million. In addition, the Company announced entering into an agreement to retain Recruitology as its partner to provide employment services to the Companys customers.
A copy of the Companys press release regarding the matters described in Items 3.01 and 8.01 above is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
Exhibit |
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Description |
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99.1 |
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Press release of The McClatchy Company, dated September 7, 2017. |
EXHIBIT INDEX
Exhibit |
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Description |
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99.1 |
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Press release of The McClatchy Company, dated September 7, 2017. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
September 7, 2017 |
The McClatchy Company | |
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/s/ R. Elaine Lintecum | |
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By: |
R. Elaine Lintecum |
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Title: |
Vice President, Finance and Chief Financial Officer |
McCLATCHY ANNOUNCES COMPLETION OF SACRAMENTO SALE-LEASEBACK AND KANSAS CITY BUILDING SALE
McCLATCHY TO LIST SHARES ON NYSE AMERICAN
McCLATCHY ANNOUNCES CONTRACT WITH RECRUITOLOGY FOR EMPLOYMENT CLASSIFIED ADVERTISING SOLUTIONS
SACRAMENTO, Calif., Sept. 7, 2017 The McClatchy Company (NYSE-MNI) (McClatchy or the company) announced that in the last week it has completed the sale of The Kansas City Stars office building and land to 1729 Grand Boulevard, LLC, a 3D Development company, and The Sacramento Bee building and surrounding land in Sacramento, California to affiliates of Shopoff Advisors L.P. Together, the two transactions resulted in gross proceeds of $56.75 million.
The Sacramento transaction is a sale-leaseback of the companys buildings and land with initial annual rent payments of $4.365 million over a 15-year term beginning on September 6, 2017. In connection with its bond indenture on its unsecured notes maturing in 2027 and 2029, McClatchy will be required to repurchase approximately $32 million in publicly traded bonds within 90 days of entering into the lease on the Sacramento buildings and land. The company will also be required, within 365 days, to offer its net after tax proceeds of approximately $44.8 million from the two transactions to its senior secured bondholders of notes due in 2022 at par, or to reinvest the net proceeds into the business.
On September 1, 2017, the company retired all of the approximately $16.9 million of outstanding 5.750% Notes that matured on the same date. Coupled with the redemption of debt in our recent offering on the 9.00% Secured Notes, outstanding debt was $840 million on September 1, 2017.
Separately, McClatchy announced that its Class A common stock has been approved for listing on the NYSE American LLC (NYSE American), and the listing will be transferred from the New York Stock Exchange (NYSE). The Companys Class A shares will continue to trade under the symbol MNI. McClatchy shares are expected to begin trading on the NYSE American on September 12, 2017 and will continue to trade on the NYSEs Big Board until that time. The NYSE American is an enhanced market for small to mid-cap companies that more closely reflects McClatchys capital structure.
Finally, McClatchy has entered into an agreement with Recruitology to provide employment services to customers across its 30 markets. This is a continuation of a nearly 10-year relationship with the company, a 2017 winner of the News Media Alliances award for innovation. Together McClatchy and Recruitology are providing employers with a one-stop solution that delivers results, while also growing McClatchys market share of local recruitment advertising.
Craig Forman, McClatchys president and CEO said, We are delighted to have completed our Sacramento sale-leaseback and the sale of the Kansas City office building. Coupled with the proceeds and distribution related to the sale of a majority of our interest in CareerBuilder, which was completed earlier this year, we have increased our cash position to approximately $127 million and debt has been reduced more than $18 million, bringing net debt, that is, debt net of cash to $713 million.
As you can see, with these proceeds and our retirement last week of the entirety of our 2017 bonds, McClatchy continues to improve its balance sheet. We now face no material debt maturities until 2022, providing clarity to stakeholders as we continue to accelerate the pace and cadence of our digital transformation.
We also announced our return to the NYSE Americana sort of coming back to our roots as McClatchy initially went public on the American Stock Exchange in 1988. And while we remain within the limits for Big Board equity trading, we believe that the NYSE American trading platform is a better fit for our new capital structure while allowing us to maintain our long-term relationship with the NYSE.
Forman also noted that, We are excited, too, about continuing our relationship with Recruitology. This smart recruiting solution gives employers hyper-targeted reach to the right candidates through top local sites, national brands, social media and a network of niche digital properties. And by combining McClatchys 66 million unique monthly visitors to its local sites with Recruitologys intelligent job matching, we can offer employers access to the right candidates on the right sites.
McClatchy noted that it expects to release its third-quarter 2017 results from operations on October 16, 2017, and will provide a further business update at that time.
About McClatchy
McClatchy is publisher of iconic brands such as the Miami Herald, The Kansas City Star, The Sacramento Bee, The Charlotte Observer, The (Raleigh) News & Observer, and the (Fort Worth) Star-Telegram. McClatchy operates 30 media companies in 29 U.S. markets in 14 states, providing each of its communities with high-quality news and advertising services in a wide array of digital and print formats. McClatchy is headquartered in Sacramento, Calif., and listed on the New York Stock Exchange under the symbol MNI.
Additional Information
Statements in this press release regarding future financial and operating results, including our strategies for success and their effects, our real estate monetization efforts and the repurchase of outstanding notes, the future of CB, revenues, and managements efforts with respect to cost reduction efforts and efficiencies, cash expenses, revenues, adjusted EBITDA, debt levels, interest costs and creation of shareholder value as well as future opportunities for the company and any other statements about managements future expectations, beliefs, goals, plans or prospects constitute forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Any statements that are not statements of historical fact (including statements containing the words believes, plans, anticipates, expects, estimates and similar expressions) should also be considered to be forward-looking statements. There are a number of important risks and uncertainties that could cause actual results or events to differ materially from those indicated by such forward-looking statements, including: McClatchy may not generate cash from operations, or otherwise, necessary to reduce debt or meet debt covenants as expected; we may not be successful in reducing debt whether through tenders offers, open market repurchase programs or other negotiated transactions; including sales of real estate properties may not close as anticipated or result in cash distributions in the amount or timing anticipated; McClatchy may not successfully implement audience strategies designed to increase audience revenues and may experience decreased audience volumes or subscriptions; McClatchy may experience diminished revenues from advertising; McClatchy may not achieve its expense reduction targets including efforts related to legacy expense initiatives or may do harm to its operations in attempting to achieve such targets; McClatchys operations have been, and will likely continue to be, adversely affected by competition, including competition from internet publishing and advertising platforms; increases in the cost of newsprint; bankruptcies or financial strain of its major advertising customers; litigation or any potential litigation; geo-political uncertainties including the risk of war; changes in printing and distribution costs from anticipated levels, including changes in postal rates or agreements; changes in interest rates; changes in pension assets and liabilities; changes in factors that impact pension contribution requirements, including, without limitation, the value of the company-owned real property that McClatchy has contributed to its pension plan; increased consolidation among major retailers in our markets or other events depressing the level of advertising; our inability to negotiate and obtain favorable terms under collective bargaining agreements with unions; competitive action by other companies; an inability to fully implement and execute its share repurchase plan; and other factors, many of which are beyond our control; as well as the other risks detailed from time to time in the companys publicly filed documents, including the companys Annual Report on Form 10-K for the year ended Dec. 25, 2016, filed with the U.S. Securities and Exchange Commission. McClatchy disclaims any intention and assumes no obligation to update the forward-looking information contained in this release.
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Contact: |
Stephanie Zarate Investor Relations Manager (916) 321-1931 szarate@mcclatchy.com |