Newspapers aren’t as common as they used to be, and this can be seen as some businesses struggle to stay afloat. One recent Chapter 11 bankruptcy plan that was filed came from McClatchy, one of the largest newspaper publishers in the nation, after it claimed that debt and declining print revenue has harmed its business.
The Chapter 11 bankruptcy that the company filed will allow it to keep 30 newspapers in print while it reorganizes its debts. It has approximately $700 million in debt with around 60% of that debt potentially eliminated through the plan filed with the court.
If the plan does get approved by the court, then the 163-year-old company would be placed into the hands of Chatham Asset Management, its largest creditor. CAM has obtained $50 million to support the company’s operations while moving through bankruptcy.
This kind of shut down shouldn’t be a surprise to most Americans. In fact, around 20% of all newspapers in the United States have shut down since 2004. Around 47% of the jobs in the field have also been lost.
A bankruptcy plan like this one can be beneficial for businesses. It allows them to keep many of the people who work for them employed and can help eliminate outstanding debts. Newspapers may continue to struggle in the United States, but options like Chapter 11 bankruptcy can help.
It can be hard to imagine going through bankruptcy as a business owner, but it doesn’t have to mean the end of your business as you know it. The right kind of bankruptcy can get your business back on track.