FriendFinder Networks FFNT.PK, which publishes the adult magazine Penthouse, filed for Chapter 11 bankruptcy on Tuesday with the aim of cutting its debt load as the company struggled to make certain loan payments, a court filing showed.
The holding company, which also houses internet sites such as adultfriendfinder.com, listed out estimated liabilities of $500 million to $1 billion and assets less than $10 million, according to a court filing.
FriendFinder has not turned in a net profit at least since 2008, Thomson Reuters data shows. Total revenue for the four consecutive fiscal quarters ended June 30, 2013 was $293.70 million, a filing showed.
"Despite continuing member interest and high volume traffic, the debtors did not make certain payments to the holders of existing first lien notes and cash pay second lien notes which constituted a default under their respective indentures," FriendFinder said in the filing.
FriendFinder said it agreed with certain holders of its senior debt to restructure its balance sheet and has commenced Chapter 11 proceedings to implement its recapitalization plan.
In 2010 the owner of Penthouse magazine offered to buy rival Playboy Enterprises Inc for $210 million. The deal later fell through.
The case is FriendFinder Networks Inc, Case No. 13-12405, U.S. Bankruptcy Court, District of Delaware.
(Reporting by Sakthi Prasad in Bangalore; Editing by Mark Potter and Louise Heavens)