Catalina Marketing gets confirmation of pre-packaged Chapter 11 plan

By Sarah Lizee

Olympia, Wash., April 28 – Catalina Marketing Corp. received confirmation of its pre-packaged Chapter 11 plan from the U.S. Bankruptcy Court for the Southern District of New York on Friday, according to a press release.

The company said it expects to close the sale of its Japanese entity, Catalina Marketing Japan K.K., to Yosemite 2 K.K., an equity-funded entity of D Capital, Inc., and emerge from Chapter 11 in the coming days.

Upon emergence, Catalina said it will substantially reduce its debt and move forward with a significantly strengthened balance sheet to accelerate investment in strategic growth areas.

As previously reported, the company filed Chapter 11 to implement a restructuring support agreement with more than 99% of its lenders.

Currently, the company’s capital structure includes a $36 million super-priority term loan, a $110.4 million subordinated first-out term loan and a $224 million subordinated last-out term loan.

According to a disclosure statement filed March 28, the debtors’ $370.4 million of secured debt will be reduced by about 70% to about $110.4 million.

A new $110.4 million term loan facility will be issued to holders of first-out debt claims, subject to dilution by a management incentive plan (MIP). This is expected to lead to a 90% to 100% recovery for this class.

All other creditors are expected to be unimpaired.

Holders of last-out debt claims will be entitled to receive their pro rata share of 100% of the new common stock, subject to dilution from the MIP. Existing equity will be canceled.

Holders of super-priority senior term loan claims will be paid in full in cash in the amount of $36 million, plus accrued interest and other amounts due.

The debtors will continue to pay allowed general unsecured claims in the ordinary course of business.

Catalina is a St. Petersburg, Fla.-based provider of personalized digital media. The company filed bankruptcy on March 28 under Chapter 11 case number 23-10469.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.