Sony today. Who's next?
April 15--WILMINGTON -- An executive of The Inquirer's parent company testified Tuesday that he was shocked at the "culture" he found on the business side when he joined Interstate General Media Holdings L.L.C. in 2012 and now thinks the company is "in distress and at a serious breaking point," in part because of the ongoing ownership dispute.
"On my first day, I could tell I inherited an organization that was dysfunctional, decimated and disheartened," said George Loesch, senior vice president for sales and marketing.
Loesch was called by lawyers for the ownership group led by George E. Norcross III on the second day of a hearing in Delaware'sCourt of Chancery to determine how the company is dissolved and sold.
The two groups of IGM owners say they want to bid for control of the company, but each have proposed a different format auction to Vice Chancellor Donald F. Parsons Jr.
Owners Lewis Katz and H.F. "Gerry" Lenfest prefer a public auction with single sealed bids, arguing that it will bring the most value for the company.
Norcross, Joseph Buckelew and William Hankowsky prefer a private auction among the current owners. The Norcross group argues that its format could be completed more quickly and at less cost than Katz and Lenfest's plan, giving more stability to a troubled business.
Loesch told Parsons that he came to IGM after Norcross persuaded him in August 2012 to leave Camden-based Campbell Soup Co. after 28 years.
The two men had met on the tennis court 10 or 12 years ago, Loesch said. Besides running an insurance brokerage firm and being a New Jersey Democratic Party leader, Norcross is chairman of the board of trustees of the Cooper Health System and Cooper University Hospital.
Loesch said that as an executive at Campbell, he got to know Norcross through various civic events that involved Cooper and Campbell, but said they have no other business dealings and have not hosted each other's families for dinner.
Loesch said he arrived a bit early on his first day of work at approximately 7 a.m., hoping to set an example, but was dismayed to see advertising personnel arriving intermittently until 10 a.m.
He likened the IGM business operation to the Philadelphia 76ers basketball team, which has the second worst-record in the NBA this season.
"I had to terminate 10 underperforming personnel," Loesch said. "I needed to rebuild the organization."
Norcross testified Monday that shortly after buying the company, he and Katz were dismayed to learn that revenue projections for that month were dramatically lower than what Norcross said he was led to believe before buying IGM.
The attorneys for Katz and Lenfest declined to cross examine Loesch. Those owners are also scheduled to testify Tuesday. The hearings could last through Thursday, and Parsons may rule as soon as next week.
IGM employs about 1,800 people at the Inquirer, Philadelphia Daily News, three websites and a printing plant in Conshohocken.
Staff writer Thomas Fitzgerald contributed to this report.
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