June 7, 2012
By: John Clark
Formerly successful publisher Boston Hannah International LLC is filing for Chapter 7 bankruptcy in an attempt to shed debts created by the recession and reduced demand for its products.
The publishing company, which has officers in Chicago and London, told the bankruptcy court that it has up to $1 billion in liabilities, and only $50,000 worth of assets, according to a recent report from Reuters.
Boston Hannah filed for bankruptcy in Delaware, where it has its corporate headquarters. Many companies prefer to call Delaware home due to the state’s business-friendly corporate tax laws.
Sources were not able to reach the company’s bankruptcy lawyer, but the group’s decision to file for Chapter 7 bankruptcy suggests that it may be looking to sell off its brands in order to obtain money to pay its creditors. This, however, is just speculation.
According to its website, Boston Hannah produces a broad range of magazines, websites and digital publications. In recent years, publishing companies that used to focus on traditional materials like magazines, newspapers and books have found themselves scrambling to adapt to the Internet Age.
As more and more readers turn towards e-books and other Internet-based technologies for their reading entertainment, publishing companies have seen dramatic decreases in their profits.
Boston Hannah’s own website reveals the industry’s heightened focus on building an electronic presence, as it promises that the company is a “diversified publishing group” that produces magazines “that run in synergy with websites and digital applications.”
In addition to reduced demand for hard copies of books and magazines, publishers have also had to contend with the increased popularity of self-publishing, which allows successful authors to bypass traditional publishing outlets and simply post their work electronically on their own initiative.
These trends have led to a financial nightmare for publishers. Boston Hannah’s bankruptcy, in fact, comes just a week after the bankruptcy filing of Houghton Mifflin Harcourt, a Boston-based publisher that also failed to withstand shifting cultural tides.
These shifting tides forced Boston Hannah into bankruptcy, as well, despite the fact that the company publishes magazines in the United States, the United Kingdom, and across continental Europe.
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