Getbig.com: American Bodybuilding, Fitness and Figure
Getbig Main Boards => Gossip & Opinions => Topic started by: Insider X on December 10, 2008, 12:16:28 PM
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AMERICAN Media moved a half step closer to being the next major media company to file for bankruptcy.
On Dec. 1, the publisher of Star magazine and the National Enquirer missed the final deadline to make a $21.2 million interest payment, and is feverishly negotiating with bondholders of $1.1 billion of its debt.
Two industry sources told Media Ink that the company has retained bankruptcy lawyers, suggesting that it could soon be following the path taken earlier this week by Sam Zell's Tribune Co., which filed for Chapter 11 bankruptcy protection.
However, a filing could be avoided if bankers - who have been pressuring the bondholders to give up more of their stake in the company - suddenly come to terms.
Moody's reported that on Dec. 1, American Media entered into a "forbearance agreement" with its lenders and bondholders under which if it fails to pay interest on its 10.25 percent debt, it "would not constitute an immediate event of default under the terms of the notes."
"It sounds like there is a standoff between the bondholders and the bankers," said one source.
If the restructuring deal is approved, it would effectively wipe out stakeholders Evercore Partners and Thomas H. Lee & Partners, and turn over 95 percent of the stock to those holding the debt. The old shareholders would retain just 5 percent of the company under the new transaction.
While the bondholders seemed willing to go along with such an arrangement, bankers wanted bondholders to give up more than the $250 million. They have until Dec. 15 to reach an agreement.
The banks want them to take more than a 40 percent "haircut" under the current restructuring proposal.
The bond-interest payment was actually due on Nov. 1, but the company had a 30-day grace period, which expired Dec. 1.
American Media has always been cash-flow positive, but has had trouble servicing the debt it took on as CEO David Pecker cobbled together the company.
Though the company on Nov. 1 had $34.6 million in cash on hand, which could have satisfied the $21.2 million payment, the company missed the payment with a strategy in mind.
"[Pecker] knew the bondholders were ei ther going to own it, or he's going into bankruptcy, so why make the payment," said one source.
It's not that news of American Media Inc. may be filing for bankruptcy is so shocking. (David Pecker is, after all, carrying $1.1. billion in debt on a company that makes money from magazines, so his ability to pay back his creditors is sort of in … doubt.) But that it's taken AMI so long to publicly acknowledge — at least through leaking to the Post's Keith Kelly — the option for bankruptcy, well, that's the unbelievable part.
Not a month goes by where Kelly isn't talking about Pecker — known to some as the American auto industry's biggest ally — trying to restructure his debt load and make his interest payments. But here's the rub: Now that Sam Zell authorized the floundering Tribune Co. to declare itself bankrupt under Chapter 11, that option is on the table for all media companies, and the shame factor is nil.
Which means Pecker, although he doesn't want to go the Chapter 11 route, can use its possibility as a bargaining tool with the creditors he owes all that cash to. Meaning: Either they can agree to renegotiate payback terms, or he'll ask for a court's protection as he takes his time in digging his way out of this hole.
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yawn.
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its obvious we must now bail out the trash mag industry as well... this could be devastating to housewives across the nation.
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its obvious we must now bail out the trash mag industry as well... this could be devastating to housewives across the nation.
Exactly. Housewives, muscle worshipers and schmoes (Flex mag).
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which magazines did they put out
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are they cutting back prize money at the O?
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Just as Video killed the Radio star,Internet killed the Magazine stars.Hmmmmmmmmmmmmmmmmm mmm :-\
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put all the magazines on the kindle.
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its obvious we must now bail out the trash mag industry as well... this could be devastating to housewives across the nation.
LOL
You're gonna see this same scenario play out over and over this year. During the easy credit years, so many companies took on massive amounts of debt on the basis of absurdly delusional revenue projections. Now, there's less money coming in, and they can't borrow any more.
This company is toast. The bankers and bondholders are just fighting over the scraps.
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LOL
You're gonna see this same scenario play out over and over this year. During the easy credit years, so many companies took on massive amounts of debt on the basis of absurdly delusional revenue projections. Now, there's less money coming in, and they can't borrow any more.
This company is toast. The bankers and bondholders are just fighting over the scraps.
Agreed. The best example in this industry is Bally's. They got credit worth $236 million, two years ago. $236 million!! ;D ;D For Bally's fitness. I wouldn't think it's worth $23 million, much less $236 million. Those places are straight dumps.
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AMERICAN Media moved a half step closer to being the next major media company to file for bankruptcy.
On Dec. 1, the publisher of Star magazine and the National Enquirer missed the final deadline to make a $21.2 million interest payment, and is feverishly negotiating with bondholders of $1.1 billion of its debt.
Two industry sources told Media Ink that the company has retained bankruptcy lawyers, suggesting that it could soon be following the path taken earlier this week by Sam Zell's Tribune Co., which filed for Chapter 11 bankruptcy protection.
However, a filing could be avoided if bankers - who have been pressuring the bondholders to give up more of their stake in the company - suddenly come to terms.
Moody's reported that on Dec. 1, American Media entered into a "forbearance agreement" with its lenders and bondholders under which if it fails to pay interest on its 10.25 percent debt, it "would not constitute an immediate event of default under the terms of the notes."
"It sounds like there is a standoff between the bondholders and the bankers," said one source.
If the restructuring deal is approved, it would effectively wipe out stakeholders Evercore Partners and Thomas H. Lee & Partners, and turn over 95 percent of the stock to those holding the debt. The old shareholders would retain just 5 percent of the company under the new transaction.
While the bondholders seemed willing to go along with such an arrangement, bankers wanted bondholders to give up more than the $250 million. They have until Dec. 15 to reach an agreement.
The banks want them to take more than a 40 percent "haircut" under the current restructuring proposal.
The bond-interest payment was actually due on Nov. 1, but the company had a 30-day grace period, which expired Dec. 1.
American Media has always been cash-flow positive, but has had trouble servicing the debt it took on as CEO David Pecker cobbled together the company.
Though the company on Nov. 1 had $34.6 million in cash on hand, which could have satisfied the $21.2 million payment, the company missed the payment with a strategy in mind.
"[Pecker] knew the bondholders were ei ther going to own it, or he's going into bankruptcy, so why make the payment," said one source.
It's not that news of American Media Inc. may be filing for bankruptcy is so shocking. (David Pecker is, after all, carrying $1.1. billion in debt on a company that makes money from magazines, so his ability to pay back his creditors is sort of in … doubt.) But that it's taken AMI so long to publicly acknowledge — at least through leaking to the Post's Keith Kelly — the option for bankruptcy, well, that's the unbelievable part.
Not a month goes by where Kelly isn't talking about Pecker — known to some as the American auto industry's biggest ally — trying to restructure his debt load and make his interest payments. But here's the rub: Now that Sam Zell authorized the floundering Tribune Co. to declare itself bankrupt under Chapter 11, that option is on the table for all media companies, and the shame factor is nil.
Which means Pecker, although he doesn't want to go the Chapter 11 route, can use its possibility as a bargaining tool with the creditors he owes all that cash to. Meaning: Either they can agree to renegotiate payback terms, or he'll ask for a court's protection as he takes his time in digging his way out of this hole.
That was in the Wall Street Journal last week......
Some Insider you fucking are... ::)
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thanks for the info, Romano
yep...only ever posts anti-AMI/WEIDER info
Just HAS to keep the so-called mag wars going
whatever
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yep...only ever posts anti-AMI/WEIDER info
Just HAS to keep the so-called mag wars going
whatever
So there's no truth to what's been posted here?
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So there's no truth to what's been posted here?
Sure there is. It was in the NY Post today, and in other variations over the last few weeks.
I have a strong feeling it will be worked out soon, but I was just commenting on the supposed "Insider" who pops in occasionally to post an anti-AMI/Weider story (and that is 99% of their posts) hiding behind his name, but is very obviously tied to someone at another magazine who supposedly isn't responsible for the BS mag war never ending.
Check out their previous posts and it's pretty obvious who it is, or at least who is pulling the strings.
Why hide behind a name if you want to post this stuff? That's the part I don't understand.
C
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AMERICAN Media moved a half step closer to being the next major media company to file for bankruptcy.
On Dec. 1, the publisher of Star magazine and the National Enquirer missed the final deadline to make a $21.2 million interest payment, and is feverishly negotiating with bondholders of $1.1 billion of its debt.
Two industry sources told Media Ink that the company has retained bankruptcy lawyers, suggesting that it could soon be following the path taken earlier this week by Sam Zell's Tribune Co., which filed for Chapter 11 bankruptcy protection.
However, a filing could be avoided if bankers - who have been pressuring the bondholders to give up more of their stake in the company - suddenly come to terms.
Moody's reported that on Dec. 1, American Media entered into a "forbearance agreement" with its lenders and bondholders under which if it fails to pay interest on its 10.25 percent debt, it "would not constitute an immediate event of default under the terms of the notes."
"It sounds like there is a standoff between the bondholders and the bankers," said one source.
If the restructuring deal is approved, it would effectively wipe out stakeholders Evercore Partners and Thomas H. Lee & Partners, and turn over 95 percent of the stock to those holding the debt. The old shareholders would retain just 5 percent of the company under the new transaction.
While the bondholders seemed willing to go along with such an arrangement, bankers wanted bondholders to give up more than the $250 million. They have until Dec. 15 to reach an agreement.
The banks want them to take more than a 40 percent "haircut" under the current restructuring proposal.
The bond-interest payment was actually due on Nov. 1, but the company had a 30-day grace period, which expired Dec. 1.
American Media has always been cash-flow positive, but has had trouble servicing the debt it took on as CEO David Pecker cobbled together the company.
Though the company on Nov. 1 had $34.6 million in cash on hand, which could have satisfied the $21.2 million payment, the company missed the payment with a strategy in mind.
"[Pecker] knew the bondholders were ei ther going to own it, or he's going into bankruptcy, so why make the payment," said one source.
It's not that news of American Media Inc. may be filing for bankruptcy is so shocking. (David Pecker is, after all, carrying $1.1. billion in debt on a company that makes money from magazines, so his ability to pay back his creditors is sort of in … doubt.) But that it's taken AMI so long to publicly acknowledge — at least through leaking to the Post's Keith Kelly — the option for bankruptcy, well, that's the unbelievable part.
Not a month goes by where Kelly isn't talking about Pecker — known to some as the American auto industry's biggest ally — trying to restructure his debt load and make his interest payments. But here's the rub: Now that Sam Zell authorized the floundering Tribune Co. to declare itself bankrupt under Chapter 11, that option is on the table for all media companies, and the shame factor is nil.
Which means Pecker, although he doesn't want to go the Chapter 11 route, can use its possibility as a bargaining tool with the creditors he owes all that cash to. Meaning: Either they can agree to renegotiate payback terms, or he'll ask for a court's protection as he takes his time in digging his way out of this hole.
I suppose i will start reading MD affter i have read this... ::)
You have opened my eyes to how good MD really is...thank you insider x
i hope an infidel shoves a bomb up your ass.
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Amazing, this coming from the NY Post, a kind of shock paper. AMI has a positive cash flow, and a 'threat' of bankrupcy doesnt mean anything, just another move to reorganize 'interest' payments. I know that Flex and M&F are doing quite well right now, and are not the issue, and will continue to do even better under the new direction. AMI has a 10.25 inerest that can and should be restructered in these times.
I just spoke to John Romano and he swears it isnt him, and for some reason, I tend to beleive him on this one. In the last few months, he has tried to keep the peace, even with Getbig and MD, and likewise here. He seems sincere in trying to stop the 'internet and magazine' wars, and we should.
These are tough economic times, for everyone.
But bodybuilding and our niche is doing ok. The Ironman and Fitness Expo in Los Angeles have already sold over 225 booths, and the Arnold Classic expo, the largest expo in our industry, has a waiting list after seliing out with 700 booths. The NPC Excalibur, in which Jon Lindsay did a great job promoting, had 210 competitors last Saturday, and the NPC Nationals two weeks earlier had over 400.
I beleive next year will be a good year too, and with lots more good pictures, stories, and more.
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bankruptcy isn't always a bad thing for the company or its shareholders/owners
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Amazing, this coming from the NY Post, a kind of shock paper. AMI has a positive cash flow, and a 'threat' of bankrupcy doesnt mean anything, just another move to reorganize 'interest' payments. I know that Flex and M&F are doing quite well right now, and are not the issue, and will continue to do even better under the new direction. AMI has a 10.25 inerest that can and should be restructered in these times.
The company, itself, offered these bonds, at that interest rate. No one held a gun to Pecker's head.
And the threat of bankruptcy does mean something. It means that Pecker no longer cares about the reputation of the company. Once you stiff bondholders and threaten bankruptcy unless they renegotiate, you basically disqualify yourself from ever getting a loan in the future.
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Anybody that has the name PECKER should go bankrupt.
Also,
VINCE. Learn some fucking grammar...
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[It could be that Weider pubs would be doing just fine if they hadn't been purchased with debt by Pecker for far more than they were worth based on delusional proforma numbers.
[/quote]
true
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Who owns the Olympia?
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I know that Flex and M&F are doing quite well right now, and are not the issue, and will continue to do even better under the new direction.
You can be the best salesman in the company, but if your bosses are mismanaging things, you could still be out of a job.
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i will buy two flex magazines today because we have to save our sport
btw
does anybody allready own the current issue of flex and can tell us the 2008 mr o results?
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i will buy two flex magazines today because we have to save our sport
btw
does anybody allready own the current issue of flex and can tell us the 2008 mr o results?
LMAO...those results won't be out until the March issue.