NEW YORK — Creditors of Malden Mills Industries Inc. on Tuesday agreed to extend through Sept. 10 chairman and chief executive officer Aaron Feuerstein’s option to buy the bankrupt company for $92 million, according to the firm.

This follows a Monday decision by the Export-Import Bank of the U.S. to loan Feuerstein $20 million toward this deal. He had been seeking $35 million.

Under the terms of Tuesday’s agreement, Feuerstein has 15 days to make up the $15 million shortfall.

As reported, Malden’s reorganization plan had called for the company to emerge from bankruptcy Tuesday, if Feuerstein had presented the $92 million. Failing that, the company’s creditors would have taken possession of the Lawrence, Mass.-based polyester fleece maker, and Feuerstein would have given up the ceo post, though he would have remained as chairman and president.

Tuesday’s agreement gives Feuerstein 15 days of breathing room.

David Costello, business manager at Malden, said Feuerstein was in talks with lenders to make up the shortfall.

“That’s work that is going on furiously as we speak,” he said Tuesday morning. “We have the set of lenders in place, we just need to work with the entire group to work up the full amount.”

The Ex-Im Bank agreed to provide a $20 million revolving loan guarantee to help Malden emerge from Chapter 11 because more than half its $175 million in annual sales are exports. Feuerstein also has significant political support in Massachusetts and on Capitol Hill because of his 1995 decision to rebuild the company’s plants in Lawrence after they were destroyed in a massive fire.

Malden filed for bankruptcy in November 2001.

To continue reading this article...

To Read the Full Article
SUBSCRIBE NOW

Tap into our Global Network

Of Industry Leaders and Designers

load comments
blog comments powered by Disqus