SAN JUAN CAPISTRANO, CA (BRAIN)—Source Interlink Companies, the publisher of 75 magazines including Bike Magazine, filed a pre-packaged bankruptcy reorganization in federal court in Delaware on Monday.
Eighteen of the company's publications are based in Orange County, California, including Bike, Powder and Snowboarder magazines.
Source Interlink has $1.9 billion in debt and $2.4 billion in assets according to April 24 Chapter 11 bankruptcy court filings.
Bike Magazine publisher Derek DeJonge was unavailable for comment. Source Interlink's website says business will continue as usual through the reorganization process, which is expected to take about 30 days.
According to a reorganization section on its website, filing this "pre-packaged" restructuring will reduce Source's interest expense, significantly improve free cash flow and allow Source to capitalize on several operational opportunities to further improve and grow the business.
Source Interlink bought the local action sports and automotive publications Primedia Inc. in 2007 for about $1.2 billion.
A hearing will be held this afternoon in bankruptcy court at which time the judge will consider a series of motions including requests to pay employee wage and maintain bank accounts.