USA: Guilford Mills Files Chapter 11 Exit Plan
Troubled textile giant Guilford Mills Inc announced on Friday it has filed a reorganisation plan it hopes will help it emerge from Chapter 11 bankruptcy protection by September 30 - the end of its fiscal year.
The North Carolina-based company, which filed for Chapter 11 in March with debts of $270 million, said the plan will give senior lenders a 90 per cent stake, with the remaining 10 per cent held by its existing shareholders.
The plan now needs to be approved by a bankruptcy court and several creditors' groups. Guilford said its senior debt facilities, which will consist of a three-year revolving credit facility and a three-year term loan, will total approximately $150m.
The Greensboro-headquartered firm added its suppliers will be paid in full and it expects sales and operating profits to continue to beat expectations as it looks to emerge primarily as an automotive fabrics manufacturer.
"I'm very pleased to announce that in accordance with a term sheet agreed to in March with our senior lenders, we filed with the bankruptcy court Thursday a plan of reorganisation that will significantly reduce our senior debt, allowing us to focus on our core operations," said John Emrich, Guilford Mills' president and CEO.
He added: "Quite simply, we are moving toward a swift and successful reorganisation. We have many people to thank for helping us get to this point: our suppliers and customers, our lenders and many others."
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