Updating a blog post from earlier this year, according to Reuters, the publisher of Reader’s Digest magazine said that it expects to emerge from bankruptcy by the end of July, after a court for the Southern District of New York approved its reorganization plan.
Reader’s Digest Association Inc and its affiliates filed for Chapter 11 bankruptcy protection for the second time in less than four years in February, citing a greater-than-expected decline in the media industry, according to Reuters. “The court’s confirmation of our restructuring plan is an important step for our company and sets the stage for our future as a much more focused company,” Chief Executive Robert Guth said in a press release.
The company said it will “see its debt reduced by more than 80 percent to about $100 million under the restructuring plan.”
Although it is used primarily used by corporations, Chapter 11 bankruptcy protection is available to partnerships, sole proprietorships and even individuals with certain levels of debt. Chapter 11 allows debtors the opportunity to remain in business and avoid liquidation of their assets. An individual who has unsecured debt may be facing the same difficult decisions as Reader’s Digest. Unlike a Chapter 11 bankruptcy, a Chapter 7 bankruptcy allows a person to discharge unsecured debt, like credit card debt or medical bills, which often go unpaid when financial issues arise.
If your financial situation is a problem and you want to end collection attempts, contact our Washington DC and Maryland bankruptcy lawyer now for a free consultation.