Monday, December 12, 2011
Newspaper Publisher Lee Enterprises Files for Bankruptcy
The newspaper publishing company Lee Enterprises Inc. has entered Chapter 11 bankruptcy. The company reached an agreement with creditors to settle its nearly $1 billion in debt. Lee Enterprises owns 48 newspapers, including the St. Louis Post-Dispatch.
The filing was expected. About two months ago, Lee had worked out an agreement with some of its creditors to refinance $769.5 million of its loans. According to Lee Enterprises, the publishing of its newspapers will be unaffected by the bankruptcy filing. The company has also said that its employees, advertisers and subscribers will not be adversely affected.
Lee filed a "prepackaged bankruptcy." In this type of bankruptcy, a company prepares a reorganization plan that is agreed to by creditors and shareholders prior to the actual filing. A prepackaged bankruptcy tends to simplify the process and save the company money. Companies including TWA and Resorts International have filed prepackaged bankruptcy in the past.
Lee Enterprises joins a multitude of newspaper companies who have filed for Chapter 11 bankruptcy in recent years. Print publications continue to face falling circulation and advertising revenue, perhaps because of the economic climate, as well as the movement of readers and advertisers to Internet-based media.
To learn more about bankruptcy, please contact an experienced bankruptcy attorney in your area.