Gatehouse Media, publisher of 97 daily newspapers, files for Chapter 11 bankruptcy
The publisher of 97 daily newspapers, Gatehouse Media, has filed have commenced voluntary chapter 11 bankruptcy proceedings in the United States Bankruptcy Court for the District of Delaware, according to a company announcement releases early this evening.
“We have complied with and are current with all our obligations, but with the challenges facing our industry and the impending maturity of our secured debt next year, we needed to be proactive in exploring options to restructure our debt, recapitalize, and position ourselves for future growth,” Michael Reed, director and chief executive officer, said.
“The prepackaged plan proposes a ‘balance-sheet restructuring,’ by which GateHouse will emerge from bankruptcy with much less debt on its balance sheet, but with its business operations completely intact. Upon emergence, we will be under common ownership with Local Media Group, a company with a strong community media presence and performance that operates eight daily community newspapers and thirteen weeklies. Joining with Local Media Group will be an important step in growing our business and will contribute to our future success as the pre-eminent source for locally focused content, covering and serving our subscribers, advertisers and customers through print, online and other digital products, including mobile applications.”
Gatehouse Media was originally founded as Liberty Group Publishing by Kenneth L. Serota, a former Hollinger International attorney. The company was backed by Leonard Green & Partners and proceeded to buy the community newspapers of Holliger. The company was then bought byFortress Investment Group bought for $527 million in 2005. Then came the expansion, with acquisitions in 2006 for Community Newspaper Company of Massachusetts, followed by more acquisitions.
The company now seeks to restructure about $1.2 billion in debt which the company says will come due in August 2014.