The Dolan Company, owner of The Daily Record, announced it has emerged from a Chapter 11 reorganization 81 days after voluntarily filing for bankruptcy protection.
As previously reported, the U.S. Bankruptcy Court for the District of Delaware approved the company’s plan of reorganization on June 9.
Under the plan of reorganization, the company’s secured lenders are now Dolan’s owners. Investment funds managed by Bayside Capital Inc. are the majority owner. Bayside is an affiliate of H.I.G. Capital, a leading global private investment firm with more than $15 billion of equity capital under management.
With its reorganization, Dolan said it has completed a comprehensive balance-sheet restructuring with its secured lenders that significantly improves the company’s capital structure.
The restructuring also establishes DiscoverReady LLC, formerly the company’s e discovery business, as a separate and independently managed operating business.
As part of the restructuring, the bankruptcy court approved a settlement between the company and a committee of equity holders. Dolan will transfer about $3.2 million of cash and a note receivable to a trust established for the benefit of shareholders of preferred and common stock.
About 20 percent of the proceeds of the trust subsequently will be distributed pro rata to holders of Dolan preferred stock as of June 12; the balance will be distributed pro rata to holders of the company’s common stock as of June 12. Dolan’s preferred and common stock have been canceled.
Dolan officials said the restructuring did not adversely affect the company’s operations during the bankruptcy process.