US discount retail chain Big Lots has secured interim court approval for key initial motions as part of its voluntary Chapter 11 proceedings.
This approval allows the company immediate access to a portion of its $707.5m post-petition financing facilities.
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The debtor-in-possession (DIP) financing, along with the company’s operational cash flow, is expected to maintain adequate liquidity during its ordinary course of business and facilitate the completion of a sale transaction with Nexus Capital Management.
The interim relief granted by the court also permits Big Lots to continue paying employee wages and benefits, as well as making payments to certain critical vendors.
The company has given assurances that vendors will be paid in full under normal terms for goods and services provided post-filing.
A follow-up hearing to review the company’s requested relief on a final basis is scheduled for 9 October 2024.
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By GlobalDataBig Lots president and CEO Bruce Thorn said: “We are focused on delivering on our promise to be the leader in extreme value by helping customers ‘Live BIG and Save LOTS’.
“With the court relief we have received today and the support of our lenders, we look forward to moving through this process and emerging as a stronger, more efficient company, well-positioned to serve our customers. We thank our associates, customers, vendors and all of our stakeholders for their continued support as we work to achieve Big Lots’ full potential.”
The company announced a sale agreement with Nexus on 9 September 2024, which includes the acquisition of the majority of Big Lots’ assets and ongoing business operations.
The Chapter 11 proceedings were initiated to facilitate this transaction.
Nexus will act as the “stalking horse bidder” in a court-supervised auction, with the sale subject to higher bids, court approval and other conditions.
If Nexus emerges as the winning bidder, the transaction is expected to close in the fourth quarter of 2024.
