Heartland Publications LLC, the owner of 23 daily newspapers and other publications in nine states, filed for Chapter 11 bankruptcy protection on Monday.
In its filing in U.S. Bankruptcy Court in Wilmington, DE, Heartland reported assets of roughly $134 million and debts of $166 million.
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GE Capital, the company's top lender, has agreed to reduce what it is owed to $70 million from approximately $111 million. In exchange, GE Capital, the financial-services arm of General Electric Co. (NYSE: GE), would get a 90 percent stake in the company.
The hedge fund Silver Point Finance LLC, the company's largest unsecured creditor, would get the remaining 10 percent ownership stake in exchange for the roughly $44 million it is owed. However, Silver Point has not yet agreed to the reorganization plan.
Heartland projects its revenue will decline 11.6 percent this year from 2008 levels after falling 4.8 percent the year before. Although it did not give a full revenue projection for 2009, the company said revenue for the 12 months ending in October totaled $55.2 million.
Heartland has nearly 800 full-time and part-time employees and publishes 23 paid-circulation daily newspapers, along with several weekly and free publications.
Heartland owns publications in Georgia, Kentucky, North Carolina, Ohio, Oklahoma, South Carolina, Tennessee, Virginia and West Virginia.
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