Reader's Digest Files For Ch 11 Bankruptcy For U.S. Arm; Ripplewood Washed Out


This had been brewing for a while: Reader’s Digest company has filed for a pre-arranged Chapter 11 bankruptcy. The company was acquired for $1.6 billion by a consortium of investors, led by PE firm Ripplewood, in 2006. It hired law firm Kirkland & Ellis earlier this year to look at restructuring options. Founded in 1922, RDA was a public company from 1990 through 2007,before it went provate with the deal; the new owners also assumed $776 million in debt. In January, RDA cut 8 percent of its 3,500-member workforce and ordered furloughs across the board.

Under the terms of the deal:
— has reached an agreement in principle with a majority of its senior secured lenders on the terms of a restructuring plan.
NYT: 60 percent of the company

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