The Reader”™s Digest Association Inc. is reorganizing its U.S. business operations in the wake of its recent Chapter 11 bankruptcy filing.
The changes, designed to accelerate growth and efficiency, will create two new divisions, U.S. Affinities and Emerging Businesses. Suzanne Grimes, currently president of the food and entertaining division at Reader”™s Digest, will head the affinities division, which will also include the company”™s home and garden group. Alyce Alston, currently president of the home and garden and health and wellness groups, will lead the emerging businesses division, responsible for developing and launching businesses throughout the corporation.
Readers Digest Community, a division focused on growing and nurturing the Reader”™s Digest brand, magazine and related products, will continue to be led by Eva Dillon.
Reader”™s Digest Association President and CEO Mary G. Berner said the changes are designed to build on gains by the company since it adopted a U.S. affinity structure in 2007 that enabled it to leverage similar businesses, building multiplatform communities of consumers around the content of leading brands. Berner said the structure has helped the company grow advertising market share and build customer communities, strengthening relations with both consumers and advertisers.
Berner said the company at the same time plans to more aggressively pursue growth initiatives. The emerging businesses division will create, test and grow new businesses from incubation to launch. Neil Wertheimer, home and garden and health and wellness editor, was named vice president and editor-in-chief for emerging businesses and content development, reporting to Alston. Weekly Reader Publishing Group and the U.S. direct-mail books business will continue to report to her as well.
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Reader”™s Digest Community will continue to grow and develop the company”™s flagship brand Reader”™s Digest. RDA officials said the division is continuing its transformation to an innovative multimedia brand by delivering content to users through expanded digital and print investments and the development of new mobile, video and multimedia applications.
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A full suite of products, branded Reader”™s Digest Version, will be launched over the next year. The division also plans to launch Best You, a multiplatform community for women over 40, in spring 2010.
Headquartered in Chappaqua, Reader”™s Digest Association reaches a customer base of 130 million in 78 countries with its books, magazines, and music, video and educational products. It publishes 94 magazines, including 50 editions of Reader”™s Digest, the world”™s largest-circulation magazine, operates 65 branded websites generating 22 million unique visitors monthly and sells about 40 million books, music and video products globally each year.
The company last month voluntarily filed for Chapter 11 protection from creditors in U.S. Bankruptcy Court as part of a financial restructuring that will reduce its debt from $2.2 billion to $550 million. A majority of the company”™s senior lenders agreed to exchange about $1.6 billion in debt for equity and a transfer of ownership to the lender group.
A bankruptcy judge last month granted the company immediate access to $100 million of a total $150 million in new debtor-in-possession financing.
