Ziff Davis Media files for bankruptcy

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Ziff Davis Media, the publisher of technology and video game magazines, has filed for Chapter 11 bankruptcy citing a decrease in revenue from print advertising and subscriptions contributing to its decline.

The company has said that it will reorganize quickly and exit court protection by the middle of summer. Ziff Davis said that it had $500 milluon in liabilities and $313 million worth of assets, as of the end of December. It filed for protection to restructure debt that had become a burden for the company.

Ziff Davis reached an agreement with senior creditors, whom they own $225 million, that they will be owed $57.5 million and at least 88.8 percent of the common stock when the company once it restructures itself.

It did not reach an agreement with its junior creditors and is looking to use the court to resolve that problem. Another 11.2 percent of the company’s stock is available to be distributed to those creditors but those creditors are likely to seek more in court. The filing states that there are between 1,000 and 5,000 creditors.

Ziff Davis is the owner PC Magazine and Electronic Gaming Monthly. It also owns the web versions of the magazines.

It reaches 26 million consumers through 16 websites, three magazines and also direct marketing. It is a remnant, according to AP, of a publishing empire established in the 1920s by William B Ziff Sr. and Bernard G Davis. The Ziff family sold a 95% stake to Forstmann, a private equity firm, for $1.4 billion in 1994. In 1995, Softbank Corp. bought 70 percent from Forstmann. In 2000, Softbank sold the company to another private equity firm, Willis Stein & Partners.

It’s total revenue fell to $76 million last year from $300 million in 2001.

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