Fri, Mar 07, 2008 | 06:56 GMT
Cox explains Ziff Davis Chapter 11 move
Here. 1UP editor Simon Cox explains why the company filed for branruptcy earlier this week, and it basically all boils down to shifting off crippling debt.
Ziff has been saddled with an enormous amount of debt for many years. An amount so large that even though we’re a profitable company (and growing all the time), the repayments were killing us; servicing that debt meant that we had very little money to play with and to invest in all the great ideas we have every day for taking our mags and websites to the next level. So last year we brought the bondholders of that debt to the table and proposed that they turn that debt into equity in Ziff Davis.
They all said yes.
What they couldn’t quite agree on was who got what percentage of the company, and so we have asked the court to decide that for them. And for us. The process will take about three to four months, and at the end of it we will effectively have new owners. In the meantime, our day-to-day operations are completely unaffected. In fact, the major bondholders have kicked in a bunch of cash to make, if anything, our day-to-day operations run smoother than they have in years.
More through the link.