Posted by Bud on September 17, 2009 at 12:51:19:
It's getting down to life or death time at the "Bright One." From today's Chicago Sun-Times:
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Bidder asks Sun-Times unions to reconsider
September 17, 2009
BY CHRIS FUSCO Staff Reporter
More unionized newsroom employees of Sun-Times Media Group rejected demands for hefty wage-and-benefit cuts and work-rule changes Wednesday, as the Chicago businessman who is leading a bid to buy the company asked the workers to reconsider.
The Chicago Newspaper Guild units of the Lake County News-Sun and Pioneer Press rejected the concessions, which Sun-Times Media officials say are necessary for a sale to James Tyree's investment group to move forward in U.S. Bankruptcy Court.
Chicago Sun-Times editorial employees turned down the cuts and rule changes on Tuesday, a day after workers at the Post-Tribune of Northwest Indiana did the same.
In an interview, Tyree said he hoped the unions would reconsider. His investment group -- STMG Holdings LLC -- issued a prepared statement that the concessions proposal "made by management could give the business a fighting chance to become successful once more. Without passage of that proposal, our plan simply won't work."
The statement marked the first time the Tyree group has spoken in some level of detail since it agreed last week to a $25 million deal to take the company out of bankruptcy.
Tyree is not ruling out meeting personally with union members, but he said that Sun-Times Media Group management, including interim CEO Jeremy Halbreich, "have to spend the next two, three, four, five days talking to everybody."
Halbreich on Wednesday was doing just that, meeting with union workers at the Sun-Times printing plant in Chicago, Pioneer Press in Glenview and at the Herald-News in Joliet.
"I don't own anything" yet, Tyree told the Sun-Times. "What I've put on the table is what we would do, and management is in the process of explaining all that.
"If it didn't work out, I would certainly go sit and talk with folks," Tyree added. However, "it wouldn't be to negotiate, it would be to explain it."
At the Lake County News-Sun, the 12-4 vote to reject the three-year package of concessions -- which include the elimination of seniority and ability to move workers throughout the company from location to location -- was a "horribly painful, difficult decision," said Jim Newton, the News-Sun unit's Newspaper Guild chair.
"Our members have already shown we are willing to make the financial sacrifices necessary to keep the paper alive, and sincerely hope for the prompt opportunity to explore an agreement on the other issues that gives all of us the flexibility to move forward," Newton said.
Pioneer Press union members voted 32-9 to reject the concessions Wednesday evening.
Guild Executive Director Tom Thibeault said his next step is to comply with the union's desire to meet with management to try to open up the concessions for negotiations.
As for the possibility of another vote on the concessions package, "if the leadership of the Sun-Times [Guild] is willing to call a revote, that's their prerogative," Thibeault said.
"The problem is this has been thrown at us as a take-it-or-leave-it," Thibeault said. "We understand this is a difficult thing for [Tyree], but he needs to understand this is a difficult thing for us."
STMG Holdings' statement on purchase of Sun-Times Media Group assets
We are disappointed to learn that the Chicago Sun-Times unit of the Chicago Newspaper Guild has voted to reject amendments to their collective bargaining agreement that were proposed by Sun-Times Media Group ("STMG"). We believe that the seniority and work rule changes and cost saving measures proposed by the company's current management are vital to save the Sun-Times News Group Newspapers and Web sites, including the Chicago Sun-Times.
Although we understand and respect the Chicago Newspaper Guild's difficult decision, the investors of STMG Holdings have determined, after five months of intensive review, that any successful business plan would require drastic changes to the current business model, including the cost-savings and flexibility sought through the amendments current management is seeking from the Guild and all its other unions. Without these changes, our investors, led by Jim Tyree, would not be able to move forward with their plan to absorb significant projected initial losses and invest more than $25 million in capital to create the self-sustaining enterprise that they envision.
STMG Holdings continues to believe that the Sun-Times News Group is a high-quality organization that has great potential—but it cannot survive without implementing an aggressive restructuring plan. To save the Sun-Times and reposition it as a leader in a challenged industry, there needs to be a drastic change in the company’s strategic and operating business model. We have worked hard with management to develop a model that we believe can be successful, if it has the support of all constituencies.
We recognize that in order for this to work, all constituencies need to participate and consider the following realities:
-- The current business model is broken and is no longer effective. STMG is losing significant amounts of money each week and has been for an extended period of time.
-- With its bankruptcy filing in March, the employees effectively lost the right to full payment of their severance and their defined benefit plans.
-- STMG Holdings' goal is to save jobs and a great Chicago institution. Our bid includes financial and operational requirements intended to preserve jobs and avoid liquidation.
-- The status quo is not an option. STMG Holdings intends to stabilize the Sun-Times News Group's revenue after years of significant decline. It plans to invest the necessary capital to transform the company into a flexible, dynamic institution that can adapt to the changing media landscape. Through this process, it hopes that employees will be a part of a secure, leading media group for years to come.
-- The new company needs greater flexibility to innovate and a substantial reduction in cost structure in order to succeed. That, unfortunately, means that all employees - union and non-union - need to make concessions, including the elimination of inflexible work rules to ensure that the company can survive in the long term. We are certain that this industry will continue to undergo dramatic change in the years to come and we need to be prepared to transform the organization accordingly.
-- Flexibility will allow us to build an organization that's effective for all its constituents. Together, we can create:
---- A more cohesive and effective vehicle for advertisers
---- The best, highest quality, local content that’s informative and valued by readers
---- Secure and stable jobs for hundreds of employees
---- A successful Chicago institution that has been an important part of our community and a model for our industry
---- Opportunities for investors to participate in the preservation of a once-great business
We understand that everyone must make a very difficult decision. The legacy organization that Sun-Times Media Group once was, is no longer viable. What worked in the past, will not work any longer. The proposal made by management could give the business a fighting chance to become successful once more. Without passage of that proposal, our plan simply won't work.
We urge the Chicago Sun-Times unit of the Chicago Newspaper Guild to reconsider their vote, approve management's proposal, and give our plan a chance.