Orchard Brands Set to Emerge from Chapter 11

Orchard Brands will emerge from bankruptcy sometime in April. The multititle mailer, which had filed for Chapter 11 on Jan. 19, reached a global settlement with its creditors on Feb. 23.

The settlement allows Orchard Brands to proceed with its reorganization that will eliminate about $420 million of debt, according to a release. The company also received final approval of its $140 million debtor-in-possession financing and $120 million in exit financing.

“Today’s announcement is a major milestone in the restructuring process,” said Orchard Brands CEO Neale Attenborough in a statement. “The settlement, which, combined with the final approval for our DIP financing, will enable us to swiftly facilitate the consummation of the plan.”

Stuart Rose, managing director of investment bank Tully & Holland, says of the announcement: “Since the core of the company is strong and the strategy of a shared database is sound, the best option was to restructure the debt. This way the debtholders have the opportunity to recoup their investments.”

Orchard Brands’ strategy is to share its customer databases across its multiple divisions, which gives them a “valuable understanding of its customer and great leverage to grow divisions using the other divisions’ lists,” he adds.

“It all hangs together because each division targets the same basic customer group — seniors.”

Orchard Brands, which is owned by Golden Gate Capital, includes 17 titles: Appleseed’s, Bedford Fair Lifestyles, Blair, Coward, Drapers & Damon’s, Gold Violin, Haband, Intimate Appeal, Linen Source, Monterey Bay, Norm Thompson, Old Pueblo Traders, Sahalie, Solutions, The Tog Shop, Willow Ridge, and WinterSilks.

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