Second debt restructuring for the Yellow Pages


Yellow pages directory. Photo: Ross Setford.

Yellow Pages Group is undertaking a second debt restructuring in four years, but it still faces the challenge of balancing the fall in its print publications against attempts to expand its online directory business amid a backdrop of increased competition.

Yellow Pages chief executive Michael Boersen has unveiled the company’s second major debt restructuring in four years.

Creditors have approved a waiver of $ 385 million in debt, which matures in August and which Yellow Pages has admitted it cannot pay.

Twelve creditors have accepted securities in lieu of the debt owed to them. The latest restructuring has been under negotiation since February and is touted as making it easier for the company to be more flexible to improve revenues and profits.

The company’s printed directories have come under pressure as its online directories face competition from The Localist. Yellow Pages is a major partner of Google, but the search advertising giant is also a competitor.

Boersen said the slide for printing was not recognized at the time of the first restructuring, which was undertaken due to excessive leverage incorporated into the purchase of the company in the mid-2000s.

He played a key role in the 2011 restructuring agreement.

When asked if the 2011 restructuring had not fully addressed the issues the company was facing, necessitating the latest arrangement, Boersen said it was right for now and within the scope of the deal. which could be concluded between 42 parties.

He said the 2015 negotiations were much simpler because there were 12 creditors instead of 42 and because they were comfortable with it being run by the company rather than the banks.

Boersen said the nature of the decline in print directory revenues was not anticipated in 2011, and challenges still remain to expand the digital branch as print provides substantial revenues.

Calvin W. Soper