Readers digest file for bankruptcy
The Classic old magazine is preparing to file a pre-arranged bankruptcy in the United States, where it has prospered for years under slogans such as "America in your pocket".
The Reader's Digest, cosy standby of nervous patients in a thousand waiting rooms full of "how to" tips and jokes safe enough to tell grandmother, has become the latest victim of the recession and the internet's effect on paper publishing.
A with every bankruptcy . the readers digest bankruptcy will also affect other companies
Indian outsourcer HCL Technologies said on Tuesday that its US$350 million outsourcing contract with media company Reader's Digest Association will be unaffected by the U.S. company's financial problems.
Reader's Digest plan of agreement for bankruptcy
Until recently its prosperity appeared to know no bounds; it published 50 global editions in 21 languages, but its move to seek Chapter 11 bankruptcy protection, which does not affect international editions including the British one, is a pre-emptive device aimed at freeing the company of debts to allow it to trade back to happier balance books.
The company was yesterday forced to agree a plan with its lenders that will see its ownership change hands and reduce its onerous debt level to $550m (£336m).
While the readers digest magazine still has one of the largest circulations in the US, it would appear that the same issues that have recently sunk other print publications – like Vibe and The Seattle Post-Intelligencer – are in play here, with ongoing attempts to improve revenue and cut costs ultimately not going far enough to save the company from bankruptcy.