Popular U.S. Tabloids in Trouble? American Media Inc., Publisher of The National Enquirer, Star, Plans to File for Bankruptcy Protection in 2 Weeks

CBS News 11/01/2010 17:41

After years of dishing tales of celebrity folly and misfortune, The National Enquirer's publisher has fallen on hard times of its own.

American Media Inc. plans to seek federal bankruptcy protection in the next two weeks or so. The privately held company, based in Boca Raton, Fla., announced its intention Monday without sharing any details about its finances.

Calls to American Media weren't immediately returned.

American Media, whose other publications beside The National Enquirer include Star, Shape, Men's Fitness and Fit Pregnancy, is trying to get most of its creditors to back its reorganization plan before it files for Chapter 11 protection. About 80 percent of American Media's bondholders already have expressed their support, the company said.

By cobbling together a pre-packaged bankruptcy case, American Media hopes to gain court approval of its plan within 60 days of its filing. That would be much quicker than most corporate bankruptcy cases are resolved.

Like other publishers of newspapers and magazines, American Media has been struggling to recover from the worst recession since World War II while also trying to adapt to technology that has driven more readers and advertisers away from print to less expensive or even free alternatives on the Internet.