Court Approves ION’s Disclosure Statement
The disclosure statement proffered by ION Media Networks on its proposed
reorganization has received the court’s blessing. ION said the United States
Bankruptcy Court for the Southern District of New York approved its statement and authorized the media company
to start soliciting votes from creditors. The court will consider approval of
ION’s reorganization plan at a hearing scheduled for Nov. 3.
The plan is supported by lenders holding more than 70 percent of ION’s
first-lien secured debt, who provided the company’s debtor-in-possession
funding of $150 million. It has also been approved by the statutory committee
of unsecured creditors. ION, the lenders and the committee recently reached a
settlement that’s now incorporated in the reorg plan..
The plan eliminates $2.7 billion in legacy debt and preferred stock claims. It
also converts the $150 million DIP financing into 62.5 percent of the new
common stock in the reorganized company. Holders of first-lien secured debt
will receive their pro rata share of the remaining 37.5 percent of common
Holders of second-priority and general unsecured claims will share $5 million
in cash to buy 5 percent of the new common stock.
“All outstanding ION equity interests, including common stock, preferred stock
and any options, warrants or rights to acquire any equity interests, will be
cancelled and extinguished and holders thereof will not receive a distribution,”
The broadcast group said it would commence soliciting votes on the plan
“shortly.” It is expected to emerge from bankruptcy later this year.
ION filed for bankruptcy in May, listing assets of around $10 million and liabilities
of more than $1 billion.
More on ION:
July 6, 2009: “Court Approves DIP
Financing for ION Media”
ION Media said it received final approval for its $150 million
debtor-in-possession financing plan. The United States Bankruptcy Court for the
Southern District of New York gave its blessing last week just as some
creditors objected to the terms of the DIP.
July 2, 2009: “ION Media’s Creditors
Object to DIP Terms”
ION Media’s creditors are objecting to the terms of the company’s $150 million
debtor-in-possession loan. ION in turn told the U.S. District Court for the
Southern District of New York on Wednesday that the loan facility was “fair and
May 21, 2009: “ION Files for
ION Media Networks has filed for Chapter 11 in U.S. Bankruptcy Court for the
Southern District of New York, listing assets of around $10 million and
liabilities of more than $1 billion. A total of 117 subsidiaries also filed.
June 29, 2009: “ION Mobilizes TV in
Manhattan and D.C.”
The service marks the for-real commercial debut of mobile digital TV
broadcasting in the United States, though for whom is unclear. Various
prototype receivers were bandied at April’s NAB trade show, but none appear to
be readily available.