The Sun-Times Media Group Inc. said Tuesday its chairman of the board, several board members and its chief financial officer are all leaving their posts, and the embattled publisher is looking into restructuring its board.
The announcement comes after two major shareholders -- K Capital Management and Davidson Kempner Capital Management -- called for the ouster of Sun-Times Media's Chief Executive Cyrus Freidheim Jr. and members of its board, citing the need for dramatic action to turn the company around.
Sun-Times Media, which publishes the Chicago Sun-Times and some 70 community papers in the Chicago area, said Tuesday board chairman Raymond G. H. Seitz will resign, effective Dec. 31.
Chief Financial Officer William G. Barker III, also a senior vice president, will leave the company for another opportunity, Sun-Times Media said. David C. Martin will take over his post, effective next Tuesday. The 52-year-old was most recently vice president of financial planning.
Sun-Times Media also said it has turned over legal matters relating to its investigation of transactions and payments made to executives of the company and its former controlling stockholder, Hollinger Inc., to the full board and company management.
A special committee of board members was formed in 2003 to investigate and is now being dissolved. Sun-Times Media said Tuesday that two other board members who had served on the committee, Gordon A. Paris and Graham W. Savage, have resigned, effective no later than Dec. 31.
Sun-Times Media said the developments follow a settlement agreement with Hollinger announced in June, the near completion of the criminal case against the former management and directors of the company, and other matters relating to civil litigation in U.S. District Court for the Northern District of Illinois.
The company was formed after the dissolution of Conrad Black's Hollinger International media empire. Earlier this month it said it lost almost $170 million in the third quarter, part of an industrywide slump due to shrinking advertising revenue. The loss was an improvement over last year's results, but it wasn't enough to keep the company from announcing another round of cost cutting.
Sun-Times Media said due to the resignations of Paris, Savage and Seitz, and shareholder requests, the board is looking at a general restructuring of the board, to be finished around the first of the year.
It said board-member committees are evaluating candidates, including shareholder suggestions.
The company also said it has voluntarily terminated its registration of Class A Common stock. It had previously been delisted from the New York Stock Exchange in May. Sun-Times Media said in a news release it has fewer than 300 shareholders and is eligible for deregistration.
Company spokeswoman Tammy Chase said in an e-mail that the company will still be publicly traded, but it will no longer have to make certain filings with the Securities and Exchange Commission. She said, however, that Sun-Times Media will still issue news releases on major matters and quarterly financial results.