Business News
R.H. Donnelley Obtains Confirmation of Plan of Reorganization
Wednesday 13. January 2010 - - More Than 96% of Voting Creditors Support Plan - Company To Reduce Debt by $6.4 Billion - On Schedule to Emerge from Chapter 11 by end of January
R.H. Donnelley (OTC:RHDCQ) , one of the nation’s largest local business marketing solutions companies, today obtained confirmation of its Second Amended Plan of Reorganization, paving the way for the Company to emerge from Chapter 11 protection and begin making distributions to creditors by the end of January.
“We are very pleased with the court’s decision, which clears the way for us to complete our balance sheet restructuring in the next few weeks,” said David C. Swanson, chairman and CEO of R.H. Donnelley. “The plan confirmed today allows us to reduce our debt by more than $6 billion and emerge with a more manageable capital structure and a stronger financial foundation.”
The Hon. Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware confirmed the Plan at a hearing today. More than 96 percent of creditors who cast ballots voted in favor of confirmation.
“I’d like to thank all of our employees and advisors for their hard work and commitment during this process,” Swanson continued. “Through their collective efforts, R.H. Donnelley will become a stronger entity, better positioned to helping local businesses address their marketing needs.”
As previously announced, R.H. Donnelley reached an agreement on the terms of the Plan with certain creditor groups, including bank lenders and an ad hoc committee of noteholders, prior to filing for Chapter 11 protection on May 29, 2009.
Under the terms of the confirmed Plan:
— Total debt will be reduced by $6.4 billion, including approximately
$700 million of secured indebtedness.
— Total cash interest expense will be reduced by approximately $500
million annually.
— Post-emergence secured and consolidated debt will be approximately
$3.1 billion and $3.4 billion, respectively, which represents
approximately 3.0x and 3.3x net secured and net consolidated debt to
EBITDA, respectively.
— Cash balance at emergence will be at least $125 million.
— The approximately $6.0 billion of unsecured bond indebtedness will be
exchanged for virtually 100 percent of the equity in and $300 million
of unsecured notes issued by the restructured Company; all existing
equity in the Company will be extinguished.
Copies of the Plan and Confirmation Order can be found at www.rhd.com. In addition, R.H. Donnelley will file a Form 8-K with the Securities and Exchange Commission, www.sec.gov that contains these documents.
R.H. Donnelley and certain subsidiaries filed voluntary petitions for Chapter 11 under the U.S. Bankruptcy Code on May 29, 2009.