Lycra enters restructuring agreement to reduce $1.2bn debt

Under the agreement, Lycra aims to found a caller “sustainable superior structure” intended to recapitalise the institution and enactment its fiscal stability.

To instrumentality these measures, Lycra and definite affiliates person filed a voluntary prepackaged Chapter 11 lawsuit successful the US Bankruptcy Court for the Southern District of Texas.

The institution said this determination follows respective months of discussions with large fiscal creditors and expects to reason the restructuring process wrong 45 days owed to the near-unanimous enactment of stakeholders.

The restructuring program has gained important support from holders of Lycra’s elder secured word loan, 16.000% Senior Secured Notes, and 7.500% Senior Secured Notes, with these groups agreeing to backmost the projected program of reorganisation.

Lycra is seeking modular "first day" alleviation from the tribunal to let it to proceed regular concern operations passim the restructuring period.

As portion of these archetypal motions, the institution intends to proceed paying each valid debts owed to suppliers and vendors successful afloat during mean concern activities.

To unafraid ongoing operations, Lycra has secured commitments for $75m successful debtor-in-possession financing and exit financing of implicit $75m.

The exit installation is expected to refinance the debtor-in-possession funds, providing superior erstwhile the Chapter 11 process concludes. Certain Lycra entities are not included successful the Chapter 11 filing.

Lycra CEO Gary Smith said: “The Lycra Company’s products person agelong been a awesome of quality, delivering benefits similar lasting comfort, fit, and show crossed a wide assortment of apparel and idiosyncratic attraction applications.

“Today marks a important milestone for The Lycra Company arsenic we are taking decisive enactment to meaningfully trim our indebtedness and fortify our fiscal foundation. By taking this step, we volition proceed serving our customers, supporting our partners, and providing the high-quality products connected which they rely. I privation to convey our squad members for their ongoing dedication and our loyal customers and partners for their continued enactment passim the process.”

The institution has engaged Linklaters and Haynes Boone arsenic ineligible advisers, Houlihan Lokey arsenic concern banker, and FTI Consulting arsenic fiscal and communications adviser.

In November past year, the institution opened its largest spandex accumulation installation successful China arsenic portion of its ongoing concern successful the Chinese market.

"Lycra enters restructuring statement to trim $1.2bn debt" was primitively created and published by Just Style, a GlobalData owned brand.