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SBA Did Not Shut Down Blade, Voice

with 5 comments

It appears it was the owners of the Washington Blade and Southern Voice who decided to shut down their newspapers this week –not the Small Business Administration, as some had speculated.

Small Business Administration spokesperson Mike Stamler acknowledged the SBA did receive “offers” to buy the two papers from Window Media and its business ally Unite Media. But, Stamler said, the decision to decline those offers was entirely left to Window Media and Unite, not the SBA.

The Small Business Administration has loaned 39 million dollars to the Avalon Equity Fund – an investment firm—and Avalon turned around and spent $7 million to buy a majority interest in Window Media and Unite Media to obtain an interest in those publishing companies.

The SBA did put Avalon into receivership when Avalon’s own assets dropped below a required level for its SBA loan, but it was Window and Unite that made the decision to cease publishing on November 15.

The news comes as at least two investors said they’d expressed interest in buying the papers. The former owner of the Southern Voice, Chris Cash, told Gay City News she spoke to the SBA’s attorneys in the matter. And openly gay Northern Virginia newsweekly publisher Nicholas Benton said he was told in September that his bid to acquire the Washington Blade had been successful. Benton said he was blind-sided by news Monday that the paper had closed in bankruptcy.

- Lisa Keen, Keen News Service.

Written by OutQ News staff

November 17, 2009 at 4:00 PM

Posted in Uncategorized

5 Responses

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  1. If the Blade is in a federal court receivership, the receiver and the federal judge overseeing the receivership would have final say over any buyout offers. I’d suggest you check the court records to see if any buyout offer actually was submitted to the court. And it seems implausible to think the SBA, with a $39 million stake and a mission to keep small businesses alive, would just sit on the sidelines, not doing something to protect its loan. But maybe that’s expecting too much from the SBA.

    beachcomberT

    November 18, 2009 at 7:20 AM

  2. [...] he had a deal to buy some of Windows’ media properties. According to a former Blade editor, the SBA claims that Windows Media made the decision themselves. SoVo and the Blade were two of the oldest LGBT [...]

  3. It has been reported more recently that the SBA receiver appointed last February for Avalon retained control over the decision to sell the Blade and did not turn the decision over to Window Media at all, contrary to this report. As a result, the successful bidder for the Blade was unable to complete the deal, since the receiver never responded to or took action to enable the owners to make the sale.

    The basis of this at SBA needs to be investigated. Was, for example, the receiver a Bush administration holdover with a personal anti-LGBT agenda? Did the receiver act in a way that was contrary to the interests of the SBA and the nation in the way they handled this?

    Dan Massey

    November 24, 2009 at 3:18 PM

    • On 11/18, we aired a story making many of these points. Because it was based mostly on the reporting of Gay City News and did not contain original reporting by OutQ News, it is not posted here. But see GCN’s story for details.

      outqnews

      November 24, 2009 at 3:29 PM

  4. Contrary to this story, it has recently been alleged that the chapter 7 filing WAS brought about by SBA actually refusing to give Window & Avalon authority to close the sale in a timely way, Can this be blamed on some Bushie bigot in SBA? Any confirmation or just paranoia?

    Dan Massey

    November 25, 2009 at 1:36 PM


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