Staff Report
Published April 30, 2010
A federal bankruptcy judge confirmed Bi-Lo Inc.’s reorganization plan Thursday. The Mauldin-based grocery store chain said it expects to emerge from bankruptcy next month with nearly all stores remaining open.
Bi-Lo operates 207 supermarkets in South Carolina, North Carolina, Georgia and Tennessee and employs approximately 15,100 people.
“We are very pleased to have reached this major milestone in Bi-Lo’s history,” President and CEO Michael Byars said in a prepared statement. “This is a great achievement for Bi-Lo and is a reflection of the company’s current performance and our commitment to our customers, suppliers and teammates. Bi-Lo will emerge from bankruptcy financially stronger, with less debt and as a more competitive company in the marketplace.”
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The reorganization plan includes $150 million in new equity from the company’s owner, Lone Star Funds, and $200 million in term loan financing from Credit Suisse. Proceeds will be used to pay off a $260 million term loan held by Ahold, Bi-Lo’s former owner.
Additionally, GE Capital agreed to provide a $150 million revolving credit facility for Bi-Lo post-emergence to fund working capital and other normal business needs. The company said it expects to have between $40 million and $50 million of cash borrowings on the revolving credit facility immediately after emergence.
Bi-Lo’s unsecured creditors withdrew a competing reorganization plan in February because they lost commitments from term lenders. Under the plan approved Thursday, unsecured creditors will divide $40 million.
Bi-Lo filed for bankruptcy protection in March, citing upcoming debt maturity that it was unable to refinance.
“With our improved balance sheet, we will continue our commitment to the communities we proudly serve and provide our customers with the lowest possible pricing to deliver the best overall value, the freshest products and the same top-quality brands they have come to expect, all with friendly, helpful service from our 15,000 teammates,” Byars said.
