Newcastle moves forward with spinoff as GateHouse files Chpt. 11

GateHouse Media (GHSE.PK +33.3%) files for Chapter 11 bankruptcy protection; part of a plan in which its lenders - led by Fortress (FIG +0.1%) affiliate Newcastle Investment (NCT +1.2%) - will exchange their claims for new common stock (Newcastle owns 52% of the debt and will get 52% of the new shares).

As part of the plan, Newcastle will turn over to GateHouse recently-acquired Dow Jones Local Media Group, and plans to spin off the unit into a new public company called New Media Investment Group.

Existing GateHouse owners would see their stakes wiped out, but will receive warrants to buy 5% of New Media's stock.

SEC Form 10.

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