Global Broadcasting of New England has filed a Receivership Petition in Rhode Island Superior Court to give its struggling WLNE Providence some financial leeway in an unforgiving business environment. The receivership may be the first step toward the sale of the station.
WLNE is an ABC affiliate and Global Broadcasting's lone station. Providence was hit particularly hard with the recession, with crippling unemployment. Massive flooding this past spring deepened the misery in DMA No. 53.
The receivership "gives a financially stressed business breathing room to restructure and reorganize its financial and business affairs," according to a statement from WLNE's law firm, Winograd, Shine & Zacks. Attorney Allan Shine says it's an alternative to Chapter 11.
There's no set timeframe for the length of the receivership, adds Shine, and they typically last a year to 18 months. "Every case is different," he stresses.
Shine says there's adequate cash flow to keep employees paid regularly, and workers' benefits are protected. "It's business as usual," he says.
The station's lender, Sovereign Bank, is working with Global Broadcasting through its struggles. The endgame may result in WLNE being put up for sale, says Shine.
The statement says WLNE entered the receivership "to preserve and protect the jobs of its 88 employees and to continue to serve its advertisers and its viewers."
Providence attorney Matthew McGowan has been appointed receiver of the station.
Global Broadcasting acquired WLNE from Freedom Broadcasting for $14 million in October 2007.