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Oriental Trading Company, Inc., on February 14 announced the completion of its reorganization efforts and successful exit from bankruptcy. The Company says emerged with a significantly improved capital structure and strong liquidity, having reduced its debt by nearly 70%.
Oriental Trading won confirmation of its reorganization plan on
Dec. 16, 2010. OTC was able to confirm the plan following a settlement between first- and second-lien lenders. The plan gives the new stock plus cash or a new $200 million second-lien note to senior lenders owed $403 million. Second lien lenders will receive five-year warrants for 5% of the stock based on a $422 million enterprise value. They will also receive five-year warrants for 4.5% based on a $447 million enterprise value.
First-lien lenders are providing $1.1 million for unsecured creditors with $6.8 million in claims.
“Today marks the beginning of a new era of growth for Oriental Trading Company. Our new capital structure provides us with a sustainable, long-term financial foundation from which we will drive the future growth of the business,” said Sam Taylor, CEO of Oriental Trading, in a Feb. 14 statement. “Business performance has stabilized over the last twelve months with revenues growing, continued double-digit operating margins, and record-high customer satisfaction.”
Oriental Trading received court approval of its plan of reorganization and secured exit financing in less than six months. The swift emergence from bankruptcy reflects the company's strength and ensured that the restructuring process did not interfere with the smooth operation of the company's business – a priority for the organization. New ownership is comprised of a group of investors that formerly held the company's senior debt.
“We appreciate the support of our customers, business partners, and lenders during the past six months as we worked through the restructuring process,” Taylor said. “In particular we want to thank our dedicated and talented employees who remained focused on delivering the same exceptional customer service and quality products that our customers have come to expect from Oriental Trading Company.”
About OTC Holdings Corporation
Omaha, Nebraska-based OTC Holdings Corporation filed for
Chapter 11 protection on August 25, 2010 (Bankr. D. Del. Case No.
10-12636). Affiliates OTC Investors Corporation (Bankr. D. Del.
Case No. 10-12637), Oriental Trading Company, Inc. (Bankr. D. Del.
Case No. 10-12638), Fun Express, Inc. (Bankr. D. Del. Case No.
10-12639), and Oriental Trading Marketing, Inc. (Bankr. D. Del.
Case No. 10-12640), filed separate Chapter 11 petitions on
August 25, 2010. The Debtors disclosed $463 million in assets and
$757 million in liabilities as of the Chapter 11 filing.
Richard Hahn, Esq., My Chi To, Esq., Jae-Sun Chung, Esq., Huyue
Angela Zhang, Esq., and Jessica Katz, Esq., at Debevoise &
Plimpton LLP, represent the Debtors. Joel A. Waite, Esq., and
Kenneth J. Enos, Esq., at Young, Conaway, Stargatt & Taylor, serve
as the Debtors' local counsel. Jefferies & Company, Inc., is the
Debtors' financial advisor. Protiviti, Inc., is the Debtors'
restructuring consultant. Kurtzman Carson Consultants LLC is the
Debtors' claims agent.
The Official Committee of Unsecured Creditors' counsel is Ashby &
Geddes, P.A.
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