Cygnus Business Media, Inc. located in Fort Atkinson, Wis., filed for Chapter 11 bankruptcy Aug. 3 – one day prior to its local farm exposition, Farmfest, open-ed its three-day show.
According to Kathy Scott, director of public relations for Cygnus, it is in response to a denied request from one of its lenders to reduce its secured debt from $180 million to $60.
Cygnus Business Media had been working with its 24 lenders and had reached agreement with 23 of the 24, including its senior lender GE Commercial.
The filing was made in Delaware Bankruptcy Court starting a process that Scott said should result in emergence from bankruptcy in 45 days or less – sometime in mid-September at the latest.
Chapter 11 is part of the U.S. Bankruptcy Code. That chapter allows for the reorganization of a business.
When a business is no longer able to service its debt or pay its creditors, that business can file for protection under Chapter 11.
Chapter 11 bankruptcy differs from Chapter 7 bankruptcy in that Chapter 11 allows the business to continue operations.
“Operations are going to continue,” said Scott. “The doors are still open.”
Most people are not going to even notice a difference.
