A media company in another state recently determined that it needed to address its poor financial situation. The company, Steel City Media, has therefore filed for Chapter 11 bankruptcy protection. Bankruptcy protection may likewise be the only recourse for companies in Massachusetts that are struggling financially.
In the out-of-state case, the media company that filed for bankruptcy protection asserted that it had already paid down its senior lender by over $20 million since 2014. That is more than 35 percent of its debt. However, the markets have evidently been soft, thus causing the company to fail to comply with specific technical covenants. The business enlisted the help of a financial advisor to help it explore alternatives to bankruptcy, including third-party investment and even standalone recapitalization. However, company leaders claimed that they felt seeking Chapter 11 bankruptcy protection would be the best way of resolving such issues.
The company said it would remain in operation while seeking to reorganize. The company apparently is still quite profitable, however. Therefore, company officials expect it to generate enough money from its operations to cover the business’ operational expenses during the bankruptcy proceedings. The media company currently owns six radio stations in two separate cities.
Sometimes, companies find themselves in financially compromised positions due to economic conditions and other external factors. Fortunately, they do not have to remain that way. An attorney in Massachusetts can walk them through the Chapter 11 bankruptcy filing process, which may provide them with the second chance they desperately need to get back on track financially.
Source: bizjournals.com, “Steel City Media files Chapter 11 bankruptcy“, Stacey Federoff, March 21, 2018