The U.S. Trustee overseeing the bankruptcy of the Alaska Dispatch News is worried that more than $21 million in debt will go unpaid without intervention from the courts.
A motion filed by U.S. Trustee Kathryn Perkins this week seeks to convert whatever is left over in the pending bankruptcy sale to a Chapter 7 bankruptcy liquidation, fearing that assets like the beleaguered paper’s three printing press will lose significant value the longer they wait.
The motion would allow the sale of the paper to the Binkley group, helmed by Fairbanks businessman Ryan Binkley, to go through on Sept. 11, but force whatever is left behind in the ownership of Alice Rogoff is liquidated to satisfy at least some of the nearly 200 creditors owed money. The motion calls for the the bankruptcy to be converted from a Chapter 11 restructure to a Chapter 7 liquidation after the sale, but before the presses become inaccessible on Oct. 11 under a GCI agreement.
“The United States Trustee presumes that Binkley’s manager will not remain in control of the debtor-in-possession after the sale, and it is unclear if Ms. Rogoff will step up to liquidate any remaining assets,” the motion explained.
Of chief concern are the paper’s three printing presses—the two inoperable presses at the Arctic Boulevard location and the functioning printing press at the GCI-owned Northway building—and what value, if any, they have. Existing testimony suggests that they could cost more to move than they’re worth. The estimates for the removal of the press and cleanup of GCI’s building is around $1.5 million.
At the most recent hearing, the attorney for the Binkley group said they are not likely to purchase any of the printing presses as part of the purchase of the ADN. The attorney for the Arctic Boulevard owners was concerned that the presses would never be moved, a concern echoed by Perkins.
“The Rogoff declaration and the testimony at the first day hearing made it clear that the debtor lacks the financial capability to immediately fund any activities beyond the sale hearing,” she said. “Thus, absent an increase in the proposed purchase price sufficient to generate a return to the estate, the debtor will lack sufficient capital to fund the removal of any remaining equipment from its leased premises in order to liquidate it for the benefit of the creditors.”
The lack of expected profits is due to the way the Binkley group has structured the sale. The group loaned the company $1 million to get it to a sale on Sept. 11 with the condition that it gets its money back before any other creditors, which it could do if it buys the paper for $1 million.
The question remains, then, of what the Binkley group plans to do with a pressless newspaper.
Rogoff now listed as creditor
According to the latest list of ADN’s creditors there’s nearly 200 creditors owed well more than $10 million all told. These debts range from as little as $10 owed to staff and freelance writers to hundreds of thousands of dollars owed to contractors and other suppliers. Many of the people and companies owed money are based in Alaska.
However, now the draft bankruptcy listing of creditors includes Rogoff, who claims she’s owed $8.1 million from the paper. The claim says it’s for “purchase money.” That makes her one of the biggest creditors to the company.