Wisconsin business owners may be interested in learning that the company that owns Penthouse magazine as well as several adult and dating websites has recently filed for Chapter 11 bankruptcy. Moving towards debt relief was something that FriendFinder Networks Inc. found necessary in light of its struggle in trying to compete with free online options offering the same types of entertainment. In a statement, the company indicated that filing for bankruptcy was the most complete and cost effective way for it to continue doing business.
FriendFinder, originally called Penthouse Media Group, expanded its operations through acquisitions in 2007 and became publicly-held in 2011. Included in its businesses are the online websites friendfinder.com, seniorfriendfinder.com, and bigchurch.com, as well as a number of adult entertainment sites.
The bankruptcy will allow the company to refinance its long-term debt and to reduce interest expenses while it attempts to reposition its stronger brands. The company's shares will no longer trade on the open market after the court-approved agreement goes into effect. The company has already been deleted from Nasdaq as its share price has fallen below $1.
FriendFinder's situation illustrates the ever-changing scenario in media and entertainment industries brought about by internet competition. A Wisconsin attorney with experience in bankruptcy proceedings may be able to help struggling businesses get back on strong financial footing by filing for Chapter 11 protection and finding ways to eliminate excessive debt. Such an attorney may possibly give clients advice on how to restructure business operations so that the company can become profitable once it emerges from bankruptcy status, and may be able to suggest alternative forms of debt relief that may be more appropriate in a particular situation.
Source: LA Times, "Penthouse publisher FriendFinder files for bankruptcy protection", Stuart Pfeifer, September 17, 2013