Welcome!

Agile Computing Authors: Elizabeth White, Pat Romanski, Ferhat Hatay, Sanjay Uppal, Pete Waterhouse

News Feed Item

RDA Reaches Agreement with Key Stakeholders to Significantly Reduce Indebtedness

-- Meaningful De-Leveraging Through a Consensual Pre-Negotiated Reorganization as Secured Noteholders Agree to Convert Approximately $465 million of Debt to Equity

NEW YORK, Feb. 17, 2013 /PRNewswire/ -- RDA Holding Co., parent company of The Reader's Digest Association, Inc., announced today that it has reached a consensual agreement on the terms of a financial restructuring with both its secured lender and over 70% of its secured noteholders.  The agreement is a key component of the Company's ongoing comprehensive transformation plan.

In order to implement the financial restructuring, the Company today filed voluntary petitions under Chapter 11 of the United States Bankruptcy Code with the U.S. Bankruptcy Court for the Southern District of New York. The filing is limited to the U.S. business and is expected to conclude in less than six months. The Company's international operations, including Canada, are not part of the filing.

In conjunction with the Chapter 11 filing, the Company executed a Restructuring Support Agreement with its secured lender and its secured noteholders.  The Agreement will result in, among other things, the Company converting approximately $465 million of secured notes to equity, which will strengthen the Company by significantly deleveraging its balance sheet.  It is currently anticipated that the Company will exit Chapter 11 with roughly $100 million of debt, about an 80% reduction in its level of indebtedness.

A group of secured noteholders has agreed to provide the Company with up to $45 million in new financing to support its operations during this process as part of a $105 million facility that will repay in full its existing bank debt.  The new money financing is open to noteholders who agree to support the restructuring.  Management is confident that this new funding will provide the Company with sufficient liquidity to complete the Chapter 11 process.  The financing is subject to Bankruptcy Court approval. 

"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 and allow us to capitalize on the growing strength and presence of our outstanding brands and products," said Robert E. Guth, the Company's President and Chief Executive Officer.  "The complex transformation that we began 18 months ago under the leadership of a new senior management team has resulted in a more streamlined, more focused, and more profitable business, but we have unfortunately been unable to align our debt levels correspondingly.  The Chapter 11 process, which will facilitate a significant debt reduction, will enable us to continue to redefine our business by focusing our resources on our strong North America publishing brands, which have shown a new vitality as a result of our transformation efforts, particularly in the digital arena."

"I am extremely grateful for the hard work and ongoing dedication of all our employees who are responsible for the great strides we are making and who share a strong pride in our heritage and our culture.  I'm certain that this team will approach this restructuring milestone with the same level of professionalism and character that has seen us through prior challenges," Mr. Guth continued.

The Chapter 11 filing is not expected to impact the Company's day-to-day operations.  The Company will continue to market and publish all of its U.S. publications during this process, as well as its international publications.  In addition, with respect to its international business and consistent with its ongoing strategy, the Company continues to pursue agreements to sell and license international businesses and expects to finalize certain agreements in the coming weeks.

The Company has filed a variety of first day motions with the Court that, with Court approval, will allow it to continue to conduct business in the ordinary course without interruption.  These include a request for authority to continue paying employees and its network of freelancers on normal schedules as well as the request to honor all of its customer programs, including those for its sweepstakes winners.  The Company expects to receive approval for these motions shortly.  The Company's qualified pension plan remains overfunded and will continue to be used to support its retirees.  Suppliers and vendors will be paid for goods and services provided to the Company after the February 17, 2013 filing.

In addition to its Chapter 11 action, the Company also filed certain required notices with the Securities and Exchange Commission to suspend its SEC reporting obligations consistent with SEC rules and regulations. Throughout the Chapter 11 process financial information on the Company will continue to be available through the Court docket. For more information regarding this announcement, please visit the Restructuring tab of www.rda.com.

About The Reader's Digest Association, Inc.

Reader's Digest Association (RDA) is a global media and direct marketing company that educates, entertains and connects consumers around the world with products and services from trusted brands. For more than 90 years, flagship brand Reader's Digest, the world's largest circulation magazine, has simplified and enriched consumers' lives by discovering and expertly selecting the most interesting ideas, stories, experiences and products in health, home, family, food, finance and humor. Taste of Home is the world's largest circulation food publication and is the leading multi-platform producer of information on food, cooking and entertaining. Other brands include The Family Handyman, Birds & Blooms, Country, and many other enthusiast titles in the U.S. and internationally.  The company provides content in print; online; via digital download on iPad, mobile apps, Kindle, KindleFire, Nook, Sony Reader and Zinio; books and home entertainment products; Facebook, Twitter and other social media outlets. Further information about the company can be found at www.rda.com.

Forward-looking Statements

This press release contains, and oral statements made from time to time by our representatives may contain, forward-looking statements that are based upon our current expectations and assumptions concerning future events, which are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated.  The words "expect," "anticipate," "estimate," "forecast," "initiative," "objective," "plan," "goal," "project," "outlook," "priorities," "target," "intend," "evaluate," "pursue," "commence," "seek," "may," "would," "could," "should," "believe," "potential," "continue," or the negative of any of those words or similar expressions is intended to identify forward-looking statements.  All statements contained in this press release, other than statements of historical fact, including, without limitation, statements about our operations, financial condition and liquidity, strategies, business initiatives, prospects, expectations regarding future events and our financial performance and the development of the industry in which we operate, are forward-looking statements that involve certain risks and uncertainties.  While these statements represent the Company's current judgment on what the future may hold, and the Company believes these judgments are based upon reasonable assumptions, these statements are not guarantees of any events or financial results, and the company's actual results may differ materially.  Important factors that could cause our actual results to be materially different from our expectations include those risks described in our annual report found on Form 10-K which was filed with the Securities and Exchange Commission on March 29, 2012.

You should not place undue reliance on the forward-looking statements contained in this press release.  These forward-looking statements speak only as of the date on which the statements were made.  The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements, except where expressly required by law.

SOURCE The Reader’s Digest Association, Inc.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@ThingsExpo Stories
With an estimated 50 billion devices connected to the Internet by 2020, several industries will begin to expand their capabilities for retaining end point data at the edge to better utilize the range of data types and sheer volume of M2M data generated by the Internet of Things. In his session at @ThingsExpo, Don DeLoach, CEO and President of Infobright, will discuss the infrastructures businesses will need to implement to handle this explosion of data by providing specific use cases for filte...
SYS-CON Events announced today that Pythian, a global IT services company specializing in helping companies adopt disruptive technologies to optimize revenue-generating systems, has been named “Bronze Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2015 at the Javits Center in New York, New York. Founded in 1997, Pythian is a global IT services company that helps companies compete by adopting disruptive technologies such as cloud, Big Data, advanced analytics, and DevO...
SYS-CON Events announced today that Avere Systems, a leading provider of enterprise storage for the hybrid cloud, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Avere delivers a more modern architectural approach to storage that doesn’t require the overprovisioning of storage capacity to achieve performance, overspending on expensive storage media for inactive data or the overbuilding of data centers ...
SYS-CON Events announced today that Commvault, a global leader in enterprise data protection and information management, has been named “Bronze Sponsor” of SYS-CON's 18th International Cloud Expo, which will take place on June 7–9, 2016, at the Javits Center in New York City, NY, and the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Commvault is a leading provider of data protection and information management...
The Quantified Economy represents the total global addressable market (TAM) for IoT that, according to a recent IDC report, will grow to an unprecedented $1.3 trillion by 2019. With this the third wave of the Internet-global proliferation of connected devices, appliances and sensors is poised to take off in 2016. In his session at @ThingsExpo, David McLauchlan, CEO and co-founder of Buddy Platform, will discuss how the ability to access and analyze the massive volume of streaming data from mil...
SYS-CON Events announced today that Alert Logic, Inc., the leading provider of Security-as-a-Service solutions for the cloud, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Alert Logic, Inc., provides Security-as-a-Service for on-premises, cloud, and hybrid infrastructures, delivering deep security insight and continuous protection for customers at a lower cost than traditional security solutions. Ful...
SYS-CON Events announced today that Interoute, owner-operator of one of Europe's largest networks and a global cloud services platform, has been named “Bronze Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2015 at the Javits Center in New York, New York. Interoute is the owner-operator of one of Europe's largest networks and a global cloud services platform which encompasses 12 data centers, 14 virtual data centers and 31 colocation centers, with connections to 195 ad...
SYS-CON Events announced today that Men & Mice, the leading global provider of DNS, DHCP and IP address management overlay solutions, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. The Men & Mice Suite overlay solution is already known for its powerful application in heterogeneous operating environments, enabling enterprises to scale without fuss. Building on a solid range of diverse platform support,...
WebSocket is effectively a persistent and fat pipe that is compatible with a standard web infrastructure; a "TCP for the Web." If you think of WebSocket in this light, there are other more hugely interesting applications of WebSocket than just simply sending data to a browser. In his session at 18th Cloud Expo, Frank Greco, Director of Technology for Kaazing Corporation, will compare other modern web connectivity methods such as HTTP/2, HTTP Streaming, Server-Sent Events and new W3C event APIs ...
Fortunately, meaningful and tangible business cases for IoT are plentiful in a broad array of industries and vertical markets. These range from simple warranty cost reduction for capital intensive assets, to minimizing downtime for vital business tools, to creating feedback loops improving product design, to improving and enhancing enterprise customer experiences. All of these business cases, which will be briefly explored in this session, hinge on cost effectively extracting relevant data from ...
There will be new vendors providing applications, middleware, and connected devices to support the thriving IoT ecosystem. This essentially means that electronic device manufacturers will also be in the software business. Many will be new to building embedded software or robust software. This creates an increased importance on software quality, particularly within the Industrial Internet of Things where business-critical applications are becoming dependent on products controlled by software. Qua...
SYS-CON Events announced today that iDevices®, the preeminent brand in the connected home industry, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. iDevices, the preeminent brand in the connected home industry, has a growing line of HomeKit-enabled products available at the largest retailers worldwide. Through the “Designed with iDevices” co-development program and its custom-built IoT Cloud Infrastruc...
Companies can harness IoT and predictive analytics to sustain business continuity; predict and manage site performance during emergencies; minimize expensive reactive maintenance; and forecast equipment and maintenance budgets and expenditures. Providing cost-effective, uninterrupted service is challenging, particularly for organizations with geographically dispersed operations.
Join us at Cloud Expo | @ThingsExpo 2016 – June 7-9 at the Javits Center in New York City and November 1-3 at the Santa Clara Convention Center in Santa Clara, CA – and deliver your unique message in a way that is striking and unforgettable by taking advantage of SYS-CON's unmatched high-impact, result-driven event / media packages.
As enterprises work to take advantage of Big Data technologies, they frequently become distracted by product-level decisions. In most new Big Data builds this approach is completely counter-productive: it presupposes tools that may not be a fit for development teams, forces IT to take on the burden of evaluating and maintaining unfamiliar technology, and represents a major up-front expense. In his session at @BigDataExpo at @ThingsExpo, Andrew Warfield, CTO and Co-Founder of Coho Data, will dis...
Silver Spring Networks, Inc. (NYSE: SSNI) extended its Internet of Things technology platform with performance enhancements to Gen5 – its fifth generation critical infrastructure networking platform. Already delivering nearly 23 million devices on five continents as one of the leading networking providers in the market, Silver Spring announced it is doubling the maximum speed of its Gen5 network to up to 2.4 Mbps, increasing computational performance by 10x, supporting simultaneous mesh communic...
Eighty percent of a data scientist’s time is spent gathering and cleaning up data, and 80% of all data is unstructured and almost never analyzed. Cognitive computing, in combination with Big Data, is changing the equation by creating data reservoirs and using natural language processing to enable analysis of unstructured data sources. This is impacting every aspect of the analytics profession from how data is mined (and by whom) to how it is delivered. This is not some futuristic vision: it's ha...
The cloud promises new levels of agility and cost-savings for Big Data, data warehousing and analytics. But it’s challenging to understand all the options – from IaaS and PaaS to newer services like HaaS (Hadoop as a Service) and BDaaS (Big Data as a Service). In her session at @BigDataExpo at @ThingsExpo, Hannah Smalltree, a director at Cazena, will provide an educational overview of emerging “as-a-service” options for Big Data in the cloud. This is critical background for IT and data profes...
One of the bewildering things about DevOps is integrating the massive toolchain including the dozens of new tools that seem to crop up every year. Part of DevOps is Continuous Delivery and having a complex toolchain can add additional integration and setup to your developer environment. In his session at @DevOpsSummit at 18th Cloud Expo, Miko Matsumura, Chief Marketing Officer of Gradle Inc., will discuss which tools to use in a developer stack, how to provision the toolchain to minimize onboa...
With the Apple Watch making its way onto wrists all over the world, it’s only a matter of time before it becomes a staple in the workplace. In fact, Forrester reported that 68 percent of technology and business decision-makers characterize wearables as a top priority for 2015. Recognizing their business value early on, FinancialForce.com was the first to bring ERP to wearables, helping streamline communication across front and back office functions. In his session at @ThingsExpo, Kevin Roberts...