Bridge Information Systems has filed for Chapter 11 bankruptcy protection, Reuters reports.
The financial data group has also said that it will get $150m from its largest shareholder, Welsh, Carson, Anderson & Stowe and that it has agreed with its creditors to reduce its debt by more than $700m.
The remainder of the company’s debt, approximately $400m, will be lessened in time with the sale of non-core assets. The newswire reports that Bridge might consider selling its Japan unit, its internet services unit eBridge, or a portion of its 46 per cent stake in Savvis Communications Corp.
David Roscoe, president of Bridge, said: “We are hopeful that we can conclude the reorganisation process by mid to late March.”
Last week, one of Bridges creditors, Highland Capital Management, lodged a Chapter 7 bankruptcy petition against the company. The bankruptcy filing is known as a chapter 7 which aims to liquidate the debtor.
Bridge has 5,000 staff in 65 countries. It runs a newsgathering operation, a brokerage firm, runs market data fields and internet services group eBridge. Its news service has 600 journalists in 100 locations. The company has had problems repaying bank loan instalments for months.
Recently, Dow Jones & Co, publisher of The Wall Street Journal, said it would write off its remaining investment in Bridge, as a result of Bridge’s financial difficulties. In October, Dow Jones had already written down the value of its investment in Bridge from $162.3m to $80.3m. And Automatic Data Processing also said in January that it would write down the value of its $90m stake in Bridge.
Bridge's difficulties stem from the technological and operational difficulties involved in merging a number of different data and news services.The company has said that it intends to pay employees’ wages, salaries and benefits without interruption and to fulfil its obligations to clients.