Faced with a declining readership and heavy debt, RDA Holding, the company that owns Reader’s Digest is back in bankruptcy court.
The company is seeking Chapter 11 protection as it tries to slash its existing debt down to $100 million, an 80% cut from current levels. The iconic magazine will continue to publish as normal during the bankruptcy, RDA Holding’s second run through the bankruptcy courts in four years, the Associated Press notes.
Over the past two years, the company has been selling assets to raise cash. It sold its Every Day with Rachel Ray magazine and its cooking website Allrecipes.com to Meredith (NYSE:MDP), the latter bringing in $175 million.
Reader’s Digest, the fifth biggest U.S. magazine, has seen its circulation — now around 5.5 million — tumble almost two-thirds since 1995. It has concluded agreements with 70% of its lenders to restructure operations and reduce debt.