A consultant representing pressmen at the Minneapolis Star Tribune asserts in a new bankruptcy court filing that their union is being wrongly portrayed as a roadblock to the company's successful reorganization when the real culprit is the owner's indebtedness.
R. Michael Fox, the president of Matrix Associates, a Minneapolis-based consulting firm that specializes in business turnarounds, also contends in his filing that the company has spent unspecified but large amounts of corporate funds on legal fees and outside advisers. He said the company has not provided enough financial information for his firm to analyze its business prospects coming out of bankruptcy.
Fox says there is concern that the $3.5 million in concessions that the newspaper's management wants from Local 1M of the International Brotherhood of Teamsters will be only the first round of contract cuts. Local 1M represents 116 pressroom workers.
Altogether, the company is seeking $20 million in annual savings from its 800 unionized employees and $10 million from its smaller nonunion workforce as it attempts to restructure $477 million in debt that remains from a $530 million purchase of the Star Tribune by Avista Capital Partners two years ago.
"To the best of our knowledge, the union [1M] is indeed negotiating but is wary with good reason," Fox said in his filing with the bankruptcy court in the Southern District of New York. "There is a high probability that no matter what concessions the union provides, the company will be back asking for more in short order."
Fox also raised issues about the adequacy of financing for the Star Tribune's self-funded health insurance plan and whether work-rule changes in the manning levels of the newspaper's presses would make the workplace more dangerous.
Star Tribune spokesman Ben Taylor said, "We will be officially responding to the pressmen's filings early next week."
A hearing on a variety of bankruptcy-related matters is scheduled for next Wednesday in New York.
