Bankrupt Caribe Media to transfer corporate control to lenders
Three months after filing for Chapter 11 bankruptcy protection, Caribe Media Inc., the majority owner of Axesa Servicios de Información, which publishes the “official” yellow and white pages directories in Puerto Rico, has given control of the company to its lenders, Bloomberg reported Tuesday.
The restructuring entails passing its senior secured lenders the reorganized company’s equity and share in a $55 million exit loan, as per the plan filed in a Delaware court last week. Lenders, who are owed about $127 million, would receive a recovery of 79 cents to 95 cents on the dollar, Bloomberg further noted.
The San Juan-Puerto Rico based company sought the bankruptcy court’s protection listing assets and liabilities of some $500 million, as Bloomberg reported.
In an interview in May, Joe Pelitteri, vice president of Axesa in Puerto Rico, said the bankruptcy case will not affect the local business, which he said is not included in the filing. He also noted that its subsidiaries in the Dominican Republic, which also publish yellow and white pages directories, are also exempt from the filing.
Axesa also offers Internet-based local search services, including the SuperpagesPR.com directory, which complements the services offered through the traditional paper version of the residential and commercial listings.
“The filing concerned the holding company, Caribe Media, which is looking to restructure its debt,” Pelitteri said at the time. “There are no operational entities included in the filing, so there is no operational impact.”
“We will continue to conduct business as usual at Axesa, Caribe Dominicana and LIM Dominicana – which for us means a singular focus on serving our customers and achieving our business objectives,” he further added.
In its report, Bloomberg said Caribe Media’s subordinated noteholders, who are owed about $58.5 million, will not receive any recovery under the plan submitted in court Aug. 18.
“The company filed bankruptcy so its lenders could pursue $44.2 million they claim was wrongly transferred to affiliates as dividend payments,” Bloomberg said, of the money reportedly moved in 2009 and 2010.
Colorado-based Local Insight Media Holdings Inc., which filed for Chapter 11 protection in November 2010, indirectly owes Caribe Media.