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Community Newspapers Inc. Files Chapter 11

Magazine article Editor & Publisher

Community Newspapers Inc. Files Chapter 11

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Community Newspapers Inc. files Chapter 11

Community Newspapers Inc. filed for protection from creditors under Chapter 11 of federal bankruptcy laws after an offer to buy back $240 million in "junk bonds" failed to attract enough sellers.

The Trenton, N.J.-based holding company publishes three Ohio dailies: The Morning Journal in Lorain, the News-Herald in Willoughby and the Times Reporter in New Philadelphia. CNI has said that the papers would not be affected by the bankruptcy action.

The filing Feb. 25 in U.S. Bankruptcy Court in Trenton followed a four-month, extended tender offer that ended with a small number of bondholders refusing to tender their paper for the discounts offered.

CNI has blamed holdouts - who acquired the bonds at a discount - for the collapse of the tender offer. Most institutional investors who had paid face value accepted the offer, CNI said.

Owned by the New York investment firm E.M. Warburg, Pincus & Co., CNI had been trying to buy back $240 million in bonds for $130 million. Needing 95% of the bondholders to accept the offer, CNI said 91. …

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