Belk plans to file Chapter 11 on Feb. 24, eyes one-day reorganization

By Sarah Lizee

Olympia, Wash., Feb. 8 – Belk, Inc. said it expects to complete its financial restructuring through an expedited pre-packaged, one-day reorganization and plans to file for Chapter 11 on Feb. 24.

The company anticipates that the confirmation hearing to approve the restructuring will be held on the same day, at 3 p.m. ET.

Lenders holding 99% of Belk's first-lien term loan and 100% of Belk's second-lien term loan have now entered into the previously announced restructuring support agreement.

The agreement enables Belk to raise $225 million of new capital, reduce debt by roughly $450 million and extend maturities on all term loans to July 2025.

Belk plans to continue normal operations throughout its financial restructuring.

Under the agreement, Sycamore Partners will retain majority control of Belk. Belk has secured financing commitments for $225 million in new capital from Sycamore Partners, KKR and Blackstone Credit, and some existing first-lien term lenders.

Belk has also secured an extension of the early consent deadline for additional lenders to provide commitments for the $225 million of new capital. The commitment deadline has been extended to 5 p.m. ET on Feb. 11, although additional commitments are not required for successful completion of the restructuring.

Members of an informal crossover lender group led by KKR Credit and Blackstone Credit and other participating lenders will acquire a minority ownership in Belk.

Kirkland & Ellis LLP is serving as legal adviser, Lazard is serving as financial adviser and Alvarez & Marsal North America, LLC is serving as restructuring adviser to Belk.

Latham & Watkins LLP is serving as legal adviser to Sycamore Partners. Willkie Farr & Gallagher LLP is serving as legal adviser and PJT Partners LP is serving as financial adviser to the informal crossover lender group and O'Melveny & Myers LLP is serving as legal adviser and Evercore is serving as financial adviser to the informal first-lien lender group.

Belk is a Charlotte, N.C.-based department store company.

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