American Media Inc. announced that it has struck a deal on a financial restructuring with its major creditors and will be filing a pre-packaged Chapter 11 petition in approximately two weeks.
The restructuring is premised on a debt-for-equity swap that will have its bondholders become major shareholders. The company said approximately 80% of its bondholders had approved the plan.
“I want to thank Mike Elkins and his team at Avenue Capital as well as the team at Angelo Gordon for taking an active leadership role in supporting this process by putting additional money into AMI to facilitate our transaction,” said David Pecker, Chairman, President and CEO of American Media Inc. “This demonstrates their total commitment to management and the Company. All of us are very excited about the future of AMI under this new ownership structure.”
American Media owns Star, Shape, Men’s Fitness, Fit Pregnancy, Natural Health, and The National Enquirer, along with 14 websites. The company also owns Distribution Services, Inc., the country’s #1 in-store magazine merchandising company.