Yesterday, trade publisher Cygnus Business Media filed for Chapter 11 bankruptcy protection in order to restructure its debt.
Cygnus reached an agreement with 23 out of 24 secured lenders on a financial restructuring deal that will swap debt-equity for the company’s secured debt. However, an out of court deal required a unanimous decision and the hold-out lender pushed Cygnus to file a prepackaged bankruptcy plan in Delaware Bankruptcy Court, in the hopes of swiftly ushering in the restructuring plan. Under the plan, the company’s secured debt will be reduced from $180 million to $60 million, Folio reported.
Cygnus says it expects its plan to gain court approval in about 45 days, during which time its employees and vendors will be paid and business will continue as usual.