American Media, Inc. Commences Private Exchange Offer for Outstanding Senior Subordinated Notes and Cash Tender Offer for Senior PIK Notes

NEW YORK, July 16 /PRNewswire/ -- As previously reported, American Media, Inc. (AMI), announced on July 2, 2010 that it had reached an agreement with more than 90% of its bondholders/shareholders for the company's debt in connection with the debt-for-equity exchange.

The actual launch of the exchange offering occurred yesterday and it will be concluded by the second week in August.  Each of these offers is scheduled to expire at 9:00 a.m., New York City time, on August 11, 2010, unless extended with respect to such an offer.  The consummation of these offers is conditioned upon the satisfaction or waiver of certain conditions as is customary in these types of deals.

The details of the exchange and cash tender offer are as follows:

AMI offered to exchange all of its outstanding 14% Senior Subordinated Notes due 2013 for a combination of cash and shares of common stock of American Media, Inc.  In addition, the company also commenced a cash tender offer for all of its outstanding 9% Senior PIK Notes due 2013.

In this exchange offer, bondholders are being offered $269.52 in cash and 335.62 shares of AMI common stock for each $1,000 of principal amount exchanged.  The total aggregate principal amount of outstanding subordinated notes as of the launch of the exchange is approximately $356 million.

Furthermore, the company is offering to purchase each $1,000 principal amount of its approximately $23.7 million aggregate principal amount of outstanding PIK Notes for $1,020.

Concurrently with the exchange offer and cash tender offer, AMI is soliciting consents to amend the indentures governing the subordinated notes and the PIK notes to remove substantially all of the restrictive covenants and certain events of default from such indentures.

This press release is for informational purposes only and shall not constitute an offer to sell or the solicitation of an offer to buy securities, nor shall there by any offer or sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.  The AMI common stock has not been registered under the Securities Act of 1933 or under any state securities laws, and cannot be offered or sold in the United States absent registration or an applicable exemption from registration requirements.  As a result, the AMI common stock is subject to significant restrictions on transfer and resale.

About American Media, Inc.

American Media, Inc. is the leading publisher of celebrity journalism and health and fitness magazines in the U.S.  These include Star, Shape, Men's Fitness, Fit Pregnancy, Natural Health, and The National Enquirer.  In addition to print properties, AMI manages 14 different web sites.  The company also owns Distribution Services, Inc., the country's #1 in-store magazine merchandising company.

SOURCE American Media, Inc.