Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
Reader's Digest Seeks Chapter 11 Bankruptcy Protection
Author: Joel R. Glucksman
Date: February 21, 2013
Key Contacts
Back
Reader’s Digest, a long-time staple in most American homes, is seeking Chapter 11 protection under bankruptcy law to unload hundreds of millions of dollars in debt.
RDA Holding, parent company of the Reader’s Digest Association, sought court protection in White Plains, New York, while it attempts to implement a restructuring plan with creditors. The proposed plan may help it shed $465 million in debt and obtain roughly $105 million in debtor-in-possession financing. The 91-year-old company is one of the highest circulation magazines in the nation. However, the publication – like many other popular magazines – has lost revenue as more consumers trend toward electronic media. RDA Holding listed $1 billion in assets and an equal amount in liabilities.
The company’s restructuring plan is supported by Wells Fargo, and will enable it to convert $465 million in senior notes to equity. If this process is finalized and carried out, RDA Holding said it will emerge from bankruptcy protection with $100 million in debt.
“After considering a wide range of alternatives, we believe this course of action will most effectively enable us to maintain our momentum in transforming the business,” said CEO Robert Guth.
RDA Holding has been forced to sell off other publications as of late due to falling subscriptions and shrinking newsstand sales. For example, it sold AllRecipes.com to an Iowa-based publication for $175 million, as well as the Weekly Reader for an unspecified amount, according to USA Today. Despite these sales, a company spokesperson said the company still has 21 leading brands in 76 countries that are continuing to thrive. After the company emerges from bankruptcy, it hopes to focus more heavily on its North American operations.
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Why Compliance Monitoring Matters for NY and NJ Businesses
Compliance programs are no longer judged by how they look on paper, but by how they function in the real world. Compliance monitoring is the ongoing process of reviewing, testing, and evaluating whether policies, procedures, and controls are being followed—and whether they are actually working. What Is Compliance Monitoring? In today’s heightened regulatory environment, compliance […]
Author: Dan Brecher
When Are New Jersey Business Owners Personally Liable for Corporate Debt?
New Jersey personal guaranty liability is a critical issue for business owners who regularly sign contracts on behalf of their companies. A recent New Jersey Supreme Court decision provides valuable guidance on when a business owner can be held personally responsible for a company’s debt. Under the Court’s decision in Extech Building Materials, Inc. v. […]
Author: Charles H. Friedrich
Commercial Real Estate Trends to Watch in 2026
Commercial real estate trends in 2026 are being shaped by shifting economic conditions, technological innovation, and evolving tenant demands. As the market adjusts to changing interest rates, capital flows, and workplace models, investors, owners, tenants, and developers must understand how these trends are influencing opportunities and risk in the year ahead. Overall Outlook for Commercial […]
Author: Michael J. Willner
One Big Beautiful Bill: New Tip Income Tax Rules Employers & Workers Need to Know
Part 2 – Tips Excluded from Income Certain employees and independent contractors may be eligible to deduct tips from their income for tax years 2025 through 2028 under provisions included in the One Big Beautiful Bill. The deduction is capped at $25,000 per year and begins to phase out at $150,000 of modified adjusted gross […]
Author: Scott H. Novak
One Big Beautiful Bill: New Overtime Tax Rules Employers and Employees Need to Know
Part 1 – Overtime Pay and Income Tax Treatment Overview This Firm Insights post summarizes one provision of the “One Big Beautiful Bill” related to the tax treatment of overtime compensation and related employer wage reporting obligations. Overtime Pay and Employee Tax Treatment The Fair Labor Standards Act (FLSA) generally requires that overtime be paid […]
Author: Scott H. Novak
New York’s FAIR Business Practices Act: What the New Consumer Protection Measure Means for Your Business
In 2025, New York enacted one of the most consequential updates to its consumer protection framework in decades. The Fostering Affordability and Integrity through Reasonable Business Practices Act (FAIR Act) significantly expands the scope and strength of New York’s long-standing consumer protection statute, General Business Law § 349, and alters the compliance landscape for New York […]
Author: Dan Brecher
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.