By Dave SÃ©bastien
The owner of the Washington Prime Group Inc. mall said he had filed for bankruptcy, citing the Covid-19 pandemic’s toll on the business and the need to reduce debt.
The Columbus, Ohio-based company has filed a Chapter 11 claim with the U.S. South District Bankruptcy Court, Washington Prime reported on Sunday.
It said it entered Chapter 11 after a restructuring support agreement with creditors, led by SVPGlobal, who own approximately 73% of the principal amount of its secured corporate debt and 67% of the principal amount of its corporate debt. unsecured tickets.
The company said it has secured $ 100 million in debtor-in-debt financing from creditors to support day-to-day operations during the Chapter 11 process. It said it expects the status quo at its sites. throughout the procedure.
Government-imposed lockdowns have wreaked havoc on retailers, many of whom were already affected by the shift to online shopping. Most shopping centers have reopened, but many operators have had to give rent relief to tenants.
Washington Prime Group said the Restructuring Support Agreement provided for nearly $ 950 million in debt reduction through unsecured note ownership and a $ 190 million repayment of its revolving credit facilities and term loan. The deal also includes an option for a $ 325 million equity rights offering fully backed by SVPGlobal, the proceeds of which will go towards the repayment of secured debt, the company said.
The agreement provides for a four-year extension of the remaining debt on the credit facility, full payment of receivables held by vendors and service providers, and collection for existing holders of common and preferred shares of the company. $ 40 million in cash or 6.125% of new equity. .
The company said the deal allows it to market its assets to decide whether an alternative transaction that would pay off its existing corporate debt and provide larger recoveries to existing common and preferred stock holders is feasible. The deal includes a 60-day step for the bankruptcy court to issue an order upholding the Chapter 11 plan, the Washington Prime Group said.
Write to Dave Sebastian at email@example.com