Bombay Co. Files Chapter 11

Sep 25, 2007 2:27 AM  By

(Direct Newsline) The Bombay Co., Inc. and five affiliated companies have filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code.

Also named in the filing were the firm’s U.S. subsidiaries Bombay Furniture Co Inc, BBA Holdings LLC, Bombay International Inc., Bailey Street Trading Co. and BMAJ Inc.

The filing was made in U.S. Bankruptcy Court for the Northern District of Texas, Fort Worth Division.

Bombay’s Canadian operations also will be seeking protection under the Companies’ Creditors Arrangement Act in Canada.

Bombay owes more than $8.3 million in unsecured debt, According to court documents, those creditors include AT&T ($75,000), Advertising.com Inc. ($100,621), Federal Express ($189,336), DHL ($141,991) and several real estate related and other companies.

The direct marketer and retailer filed several first day motions; to obtain interim financing authority and maintain existing cash management programs; to retain legal, financial and other professionals; to support its reorganization case and for other relief.

During the proceedings, Bombay said it would:

* Conduct business as usual through its stores and Web sites.

* Honor its customer service policies, including returns, exchanges credits and its gift card program.

* Pay “post-petition” vendors, suppliers and other business partners for goods and services provided.

* Continue to pay employees’ wages and salaries, offering the same medical, dental, life insurance, disability and other benefits.

At deadline, Bombay secured a commitment for a $115 million debtor-in-possession financing facility from General Electric Capital Corp. and GE Canada Finance Holding Co. to help stay afloat during the Chapter 11 proceedings. This financing is dependent upon court approval, which Bombay said it will ask for on Tues. Sept. 25.