* RH Donnelley receives court approval of reorganization
* Plan converts $6 billion in debt to equity
* Will emerge from bankruptcy by end of January (Adds background on company)
By Tom Hals
WILMINGTON, Del., Jan 12 (Reuters) - Yellow pages publisher R.H. Donnelley Corp received U.S. court approval on Tuesday for its plan of reorganization, clearing the way for it to exit bankruptcy.
The company will emerge having shed about $6.4 billion in debt and $500 million in annual interest payments.
The publisher filed for bankruptcy in May with a plan of reorganization it had arranged with creditors, which led to a relatively quick restructuring given the number of parties and amount of debt.
“It is remarkable to see a case with 100,000 creditors vote in this overwhelming fashion and it is a testament to the plan. I am delighted they are emerging from bankruptcy in such fine fashion,” U.S. Bankruptcy Judge Kevin Gross said.
Bondholders exchanged their $6.0 billion in unsecured debts for all of the company’s equity and $300 million in new notes.
The Cary, North Carolina, company will emerge from bankruptcy later this month with $125 million of cash and $3.4 billion in debt.
While best known for the 75 million yellow pages directories it publishes annually, the company also provides marketing services and helps businesses place local ads with online search engines.
The company filed for bankruptcy following a string of acquisitions that burdened the company with debt.
Those acquisitions included its $2.23 billion purchase of Sprint Corp’s yellow pages business in 2003, its 2004 purchase of the AT&T Yellow Pages in Illinois and the $9.5 billion purchase of Dex Media, once part of Qwest, in 2006 from Carlyle Group.
R.H. Donnelley’s expected exit from bankruptcy follows rival SuperMedia Inc, which filed for bankruptcy last year as Idearc Inc.
The case is: In re: R.H. Donnelley Corp, U.S. Bankruptcy Court, District of Delaware, No 09-11833. (Additional reporting by Caroline Humer and Emily Chasan in New York; Editing Bernard Orr)