GateHouse Media Seeks Bankruptcy Protection
by Joel R. Glucksman on September 19, 2013
GateHouse Media, Inc., a company that owns more than 400 community newspapers and websites, announced its plans to seek bankruptcy protection under Chapter 11 of the U.S. Bankruptcy Code.
The publisher maintains operations in 20 U.S. states and brought in annual revenue of $489 million in 2012. However, declining sales and large printing expenditures since the 2008 financial crisis caused GateHouse's financial performance to run into the red. The company lost $14.1 million on revenue of $119.6 million for the second quarter ending on June 30, 2013.
In a recent filing with the Securities and Exchange Commission, the company said it had reached an agreement with its largest creditor - Newcastle Investment Corp. - to restructure its $1.2 billion in debt in a pre-packaged bankruptcy filing. Newcastle, which currently owns 52 percent of GateHouse's debt, recently acquired 33 Dow Jones Local Media publications for $87 million, and plans to merge the two enterprises into a publicly-traded company named New Media. The newly-published Local Media Group puts out publications in seven states and generated $162 million in revenues last year.
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