San Francisco, Aug 24 (DPA) Reader's Digest, once a favourite monthly magazine found in doctors' offices and on coffee tables in millions of homes in the US and around the world, filed for bankruptcy Monday as part of a restructuring deal announced last week.

The deal will see lenders swap $1.6 billion in debt for a 92.5-percent stake in the restructured firm with the remaining shares reserved for the board and senior management. The deal cuts the company's debt from $2.2 billion to $550 million and does not include any of the company's foreign subsidiaries, many of which remain profitable.

The magazine is the latest of several debt-laden media companies in the US to succumb to the recession, which is also weighing on most major newspapers. The big media casualties this year include the Chicago Sun-Times, which filed for bankruptcy in March, and Denver's Rocky Mountain News, which shut down in February.