RHDC 0.14 file for chapter 11 (flip Play)
CARY, N.C., May 29 /PRNewswire-FirstCall/ -- R.H. Donnelley (OTC: RHDC), one of the nation's leading consumer and business-to-business local commercial search companies, announced that the company and its subsidiaries today filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware in order to consummate a balance sheet restructuring.
R.H. Donnelley also announced it has reached an agreement in principle with key creditor constituencies on the terms of a plan of reorganization that proposes to reduce debt by approximately $6.4 billion , eliminate approximately $500 million in annual interest expense and extend the company's bank maturities out to 2014.
Throughout the restructuring process, R.H. Donnelley will be conducting "business as usual" and does not anticipate any interruptions in the services it provides to its more than 500,000 valued customers across the U.S.
R.H. Donnelley anticipates that more than $300 million of cash on hand, as well as projected positive cash flow from operations will be more than sufficient to fund its operations during the restructuring process, and therefore does not plan to seek debtor-in-possession (DIP) financing during the reorganization of its business.
"Our growth-through-acquisition strategy never anticipated the cataclysmic collapse of the U.S. economy and the local advertising market. As a result of these developments, earlier this year we began negotiating with our lenders to restructure our debt and provide the company with a more sustainable capital structure that reflects the current economic realities," said David C. Swanson, chairman and CEO of R.H. Donnelley.
