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Friday, September 27, 2013
New media group forming out of GateHouse bankruptcy
(From Newcastle Investment Corp.)
Newcastle Investment Corp. ("Newcastle", the "Company")NCT+1.43%has announced that its Board of Directors has unanimously approved a plan to spin off its media assets, which include an interest in GateHouse Media, Inc. ("GateHouse") and 100% ownership of Local Media Group, Inc. (Note: Local Media Group is the group of newspapers Newcastle bought from Rupert Murdoch's News Corp.) Newcastle intends to effect the spin-off in early 2014 by distributing shares of its subsidiary New Media Investment Group Inc. ("New Media"). New Media will be a publicly traded company primarily focused on investing in a high quality, diversified portfolio of local media assets and on growing its online advertising and digital marketing businesses.
On September 27, 2013, GateHouse commenced voluntary chapter 11 proceedings under the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware pursuant to a prepackaged plan of reorganization (the "Plan") for which Newcastle is acting as sponsor. As a result of the transactions contemplated by the Plan, New Media will own the reorganized GateHouse and Local Media on the effective date of the Plan.
New Media has filed a registration statement with the U.S. Securities and Exchange Commission ("SEC") with respect to the planned spin-off. The spin-off is subject to certain conditions, such as the approval of the Plan by the Bankruptcy Court, the declaration of New Media's registration statement effective by the SEC, the filing and approval of an application to list New Media's common stock on the NYSE and the formal declaration of the distribution by the Board of Directors. In evaluating the spin-off, the independent members of Newcastle's Board of Directors were advised by Houlihan Lokey.