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To reorganize, Orchard Brands is seeking court approval of $140 million in special financing.
Appleseed’s Intermediate Holdings LLC, more commonly known as Orchard Brands Corp., has filed for bankruptcy.
Orchard Brands, which sells online through nearly 20 e-commerce sites, including Blair.com and NormThompson.com, filed for Chapter 11 bankruptcy protection yesterday in the U.S. Bankruptcy Court for the District of Delaware. The company, a unit of private equity firm Golden Gate Capital, filed for bankruptcy to reorganize and eliminate nearly $420 million in debt.
“The company will use Chapter 11 to reorganize its debts, and ensure its long-term financial health, while continuing to operate in the normal course of business without interruption during the restructuring process,” says Orchard Brands.
Orchard Brands is seeking $140 million in special debt financing, including $40 million for a new term loan and a $100 million revolving loan. Orchard Brands has already secured $120 million in financing from its lenders, the company says.
Orchard Brands, No. 63 in the Internet Retailer Top 500 Guide, has accumulated loans of approximately $73.4 million and owes vendors such as Federal Express Corp. and Google Inc. $6.6 million and $554,077, respectively, according to the claims of creditors listed in the bankruptcy filing. “We look forward to emerging from this process as quickly as possible with a capital structure that will firmly position us for long-term success,” says CEO Neale Attenborough.
Orchard Brands, which generated web sales of $255.1 million in 2009, is the latest big retailer or direct marketing company to file for Chapter 11. In September, Blockbuster Inc. (No. 34) filed for Chapter 11 and in August, Oriental Trading Co. Inc. (No. 57) also filed for Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware.
There have been no more public documents added to Oriental Trading’s filing since last August, according to the Delaware bankruptcy court. Earlier this week in a filing with the U.S. Securities and Exchange Commission Blockbuster said it had received an extension of several weeks from the U.S. Bankruptcy Court for the Southern District of New York to further amend its reorganization and refinancing plan.