By Ken Bensinger
November 5, 2013, 8:18 a.m.
A deal to sell the Riverside Press-Enterprise to the owner of the Orange County Register may be in jeopardy less than a month after it was announced.
On Oct. 10, Aaron Kushner, owner of the Register, said he would buy the Inland Empire’s largest newspaper for $27.25 million, adding it to his fast-growing stable of Southern California dailies.
But a new filing by A.H. Belo Corp., the Press-Enterprise’s current owner, casts serious doubts on the deal.
Originally slated to close Oct. 15, the sale has been extended to Nov. 15, according to the Monday filing to the Securities and Exchange Commission, and amended provisions require Kushner to prove that his company, Freedom Communications, is financially solvent and has enough cash to operate the Riverside paper after a transfer.
Perhaps most notable is a requirement that Kushner put up $1 million in cash as a “down payment” on the deal. Such a nonrefundable payment, akin to a layaway sale at a discount store, is highly unusual in the world of mergers and acquisitions, experts say.
Freedom Communications spokesman Eric Morgan declined comment. “As a privately owned company we do not publicly discuss financial terms of an acquisition,” he said in an email.
In a statement accompanying the filing, Jim Moroney, chairman and chief executive of A.H. Belo, said the company looked “forward to closing on the previously announced sale of the newspaper operations of The Press-Enterprise” in mid-November. A.H. Belo, also owns the Dallas Morning News and the Providence Journal, among other papers.
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