Morris to File Pre-Packaged Bankruptcy Reorganization Plan
Not enough lenders agree to debt restructuring.
Augusta, Georgia-based newspaper and city magazine publisher Morris Publishing Group said Wednesday that it plans to file for a prepackaged plan of reorganization with the U.S. Bankruptcy Court on January 19.
Late last year, the publisher set a deadline for holders of its $278.5 million in senior subordinated notes to accept the terms of a debt restructuring, which would exchange that existing debt for $100 million in new, second lien secured notes. At the same time, Morris ‚Äúaffiliates‚ÄĚ would have made ‚Äúcapital contributions and repay indebtedness to Morris Publishing in order to cancel $110 million of its $138.75 million in existing senior secured indebtedness.‚ÄĚ
Under terms of the agreement, Morris needed to gain approval from 99 percent of its note holder for the exchange to happen, but did not. Some lenders held out, according to a company spokesperson, due to "bylaws of their investment funds."
In October, Morris said it had reached an agreement with holders of more than 75 percent of its senior subordinated notes on the exchange.
Morris owns a portfolio of nearly 20 city magazines‚ÄĒincluding Augusta, Athens, H magazine and Savannah‚ÄĒas well as 13 daily newspapers. The company estimates the bankruptcy process will take between six and 12 weeks, the spokesperson said.