The owner of the Brighton and Hove Independent appears to be teetering on the brink of financial collapse, according to the BBC.
The broadcaster said tonight (Friday 16 November): “Johnston Press, the publisher of many local newspapers in Sussex including the Hastings Observer, Eastbourne Herald and Sussex Express, has announced its intention to place itself in to administration.”
Johnston Press has carried a big debt burden for some years and earlier this year tried to reduce its pension liabilities.
Companies in administration have some protection from their creditors while attempts are made to sell the business either as a going concern or by breaking it up.
If a buyer or buyers cannot be found, the business would be wound up, with any assets being sold to try to pay something towards the company’s debts.
Johnston Press sought offers for its business last month but did not accept any of the offers that it received.
The BBC said: “It now plans to file for administration and says the firm’s assets will then immediately be bought by its lenders.”
JP said that if the proposed deal was approved by the courts, it would save jobs and stabilise the business.
The company’s shares are now worthless and will no longer trade on the London Stock Exchange.
The group said in a statement: “This is the best remaining option available as it will preserve the jobs of the group’s employees and ensure that the group’s businesses will be carried on as normal.
“The group hopes that this transfer will be completed within the next 24 hours.”
Chief executive David King said in a letter to staff that it had not been “an easy decision” but it would reduce debt and secure new money for the business.
He said: “We are very confident that this is not the end of the story, but the beginning of a new phase in which we work with the new owners of the group to give shape to a new future.”