Dolan, parent of business weeklies, filing for bankruptcy court protection

The Dolan Co., which owns weekly business newspapers across the country, announced Thursday that is plans to file for a prepackaged Chapter 11 reorganization that will result in the resignation of its founder and CEO.

Dolan’s papers include the Idaho Business Review, the Mississippi Business Journal, the Daily Journal of Commerce in Portland, Ore., and The Daily Record in Baltimore. All of its papers can be found here.

After emerging from bankruptcy court protection, both Dolan Co. and subsidiary DiscoverReady LLC, which is not part of the bankruptcy filing, will be privately held companies.

“The company remains well positioned in its core markets.  This reorganization step is necessary to unlock these current businesses from the weight of debt principally associated with its previous mortgage foreclosure processing businesses,” said Kevin Nystrom, the company’s chief restructuring officer, in a statement.  “The company and its lenders are committed to the customers, employees, and vendors and want to secure a bright future through this process.”

The reorganization plan contemplates that the secured lenders will become the owner of DiscoverReady and The Dolan Co.  Investment funds managed by Bayside Capital, Inc. will become the majority owner of DiscoverReady and Dolan.  Bayside Capital is an affiliate of H.I.G. Capital, a global private investment firm with more than $15 billion of equity capital under management.

James P. Dolan, the company’s founder and chief executive officer, and Scott Pollei, the company’s long-time chief operating officer, have resigned their positions with the company, with such resignations to be concurrent with the planned chapter 11 filing.  Chief Financial Officer Vicki Duncomb and General Counsel Renee Jackson will remain in their leadership positions and will assist Nystrom in managing the operations.

Given the typical speed of a “pre-packaged” plan of reorganization, the company expects to emerge from bankruptcy within approximately two months.