St. Louis, MO – Furniture Brands International ( OTC : FBN I ) and certain of its wholly-owned subsidiaries (collectively, Furniture Brands), announced today that it has filed voluntary petitions under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware . The Company also announced today that in conjunction with the filing , it is pursuing a sale process under Section 363 of the Bankruptcy Code .
To this end, Furniture Brands has entered into an asset purchase agreement with affiliate s of funds managed by Oaktree Capital Management L.P. (Oaktree) , which it intends to submit to the Court . Under the agreement, Oaktree will acquire substantially all of the assets of Furniture Brands except the company’s Lane business , through a Court-supervised auction process, subject to Bankruptcy Court approval and certain other conditions .
This bid will serve as a starting point for a sale process for the company, which may include other bidders. In addition, the Company is engaged in a process to evaluate sale alternatives for the Lane business, and has received several indications of interest from potential acquirers. Oaktree is a leading institutional investor with deep experience working with companies in situations similar to Furniture Brands.
Furniture Brands also announced that it has received a commitment from Oaktree for $140 million in Debtor - in - Possession (DIP) financing , including $50 million of new liquidity. The new facility , which is subject to court approval, will enable the Company to operate business uninterrupted and continue to meet its financial obligations, including the timely payment of employee wages and benefits , continued servicing of customer orders and shipments , and other obligations.
“After careful consideration of a range of alternatives, we firmly believe that our Chapter 11 process represents the best long - term solution for Furniture Brands to address its liquidity challenges , strengthen its operations and continue to provide our customers with the highest quality products and service that they have come to expect from us,” said Ralph Scozzafava, Chairman of the Board and CEO of Furniture Brands.
“Our portfolio includes some of the most well respected brands in the furniture industr , and we are pleased to b e partnering with Oaktree, which has deep experience working with Furniture Brands and other companies in our industry. We are highly confident that as a result of these actions , we will protect our valuable franchise and emerge as an even stronger company.
“We appreciate the continued support of our customers and suppliers during this process. We value our relationships with them and look forward to continuing those relationships for many years to come, ” said Scozzafava.
“We also appreciate the dedication and loyalty of our talented employees , whose support is , and always will be, critical to our success and to the future of the C ompany.” Miller Buckfire and Company, LLC is acting as investment banker for the Company; Alvarez and Marsal North America, LLC is acting as restructuring advisor and Paul Hastings LLP is the Company’s legal counsel. Additional information about the restructuring is available at the Company ’s website www.furniturebrands.com.
For access to Court docu ments and other general information about the Chapter 11 cases, please visit: http://dm.epiq11.com/FBN About Furniture Brands Furniture Brands International ( OTC: FBNI ) is a world leader in designing, manufacturing, sourcing and retailing home furnishings.
Furniture Brands markets products through a wide range of channels, including company owned Thomasville retail stores and through interior designers, multi-line/independent retailers and mass merchant stores. Furniture Brands serves its customers through some of the best known and most respected brands in the furniture industry, including Thomasville, Broyhill, Lane, Drexel Heritage, Henredon, Pearson, Hickory Chair, Lane Venture, Maitland - Smith and LaBarge. To learn more about the company, visit www.furniturebrands.com
Oaktree is a leader among global investment managers specializing in alternative investments, with $76.4 billion in assets under management as of June 30, 2013. The firm emphasizes an opportunistic, value - oriented and risk - controlled approach to investment s in distressed debt, corporate debt (including high yield debt and senior loans), control investing, convertible securities, real estate and listed equities. Headquartered in Los Angeles, the firm has over 750 employees and offices in 13 cities worldwide. For additional information, please visit Oaktree’s website at http://www.oaktreecapital.com
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