The U.S. Bankruptcy Court for the District of Delaware approved “a variety of first day motions” in Quiksilver Inc.’s Chapter 11 bankruptcy proceedings — including crucial debtor-in-possession (DIP) financing.
“Collectively, the orders granted by the bankruptcy court on either a final or interim basis will help Quiksilver fund its ongoing operations in the U.S. and abroad throughout the restructuring process,” the company said in a statement.
The bulk of the motions essentially involved paying various utilities companies to keep the lights on and the phones working. The court granted “on an interim basis” access to $115 million of a $175 million DIP finance package from affiliates of Oaktree Capital Management L.P. and Bank of America N.A. The company, which filed for bankruptcy protection earlier this week, said the funding will be used with other streams of money to keep the company operating in the U.S. as well as abroad.
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The retailer reiterated that its European and Asia-Pacific businesses and operations “remain strong and are not part of the filing. A majority of the company’s European bondholders also agreed that the U.S. filing would not affect their debt obligations.”
Pierre Agnes, chief executive officer of Quiksilver, said in a statement that “the relief granted ensures we will be able to continue to operate in ordinary course and deliver on our commitment to providing customers the same great experience with our brands and products they have come to expect.”
The company said the bankruptcy court also set a hearing date of October 6, 2015 to review the retailer’s plan sponsorship agreement with Oaktree.
Regarding its creditors, Quiksilver’s Chapter 11 filing listed U.S. Bank National as its largest unsecured creditor with a $225.5 million claim. The other unsecured creditors with claims were mostly merchandise vendors, and included: C&K Trading Co. Ltd. with $7.2 million; Samil Tong Sang Co. with $5.5 million; Northstar Sourcing Group HK Ltd. with $4.5 million; and Coins International Co. Ltd. with $3.9 million.