High Ridge Brands files Chapter 11 bankruptcy, plans to sell company

By Caroline Salls

Pittsburgh, Dec. 18 – High Ridge Brands Co. filed Chapter 11 bankruptcy on Wednesday in the U.S. Bankruptcy Court for the District of Delaware to facilitate an orderly process for the sale of the company, according to a news release.

High Ridge said it is in active discussions with interested bidders, and the company intends to complete a court-supervised sales process.

The company’s U.K. business operations are not included in the Chapter 11 filing.

“In the last two years, High Ridge Brands has made tremendous progress enhancing our global operations, investing in best-in-class innovation and expanding our branded personal care platform,” chief executive officer and president Patricia Lopez said in the release.

“Following a thorough review of the options available to us, we have made the decision to execute a court-supervised sales process in order to maximize the value of our strong brands.”

DIP financing

In conjunction with the sales process, High Ridge Brands has received a commitment for $20 million in debtor-in-possession financing from its existing secured lender group. The total $40 million DIP financing package also includes a $20 million roll-up of pre-bankruptcy financing.

The DIP facility will mature four months from the bankruptcy filing date.

Interest will accrue at the Base rate plus 600 basis points or Libor plus 700 bps.

The company is seeking interim access to $12.5 million of the new-money DIP facility.

Upon court approval, High Ridge said the new financing, combined with cash generated from ongoing operations, will be used to support the business throughout the sales process. The company said it has sufficient liquidity to meet its go-forward business obligations.

In addition, the company filed a number of customary motions to support its operations during the court-supervised process, including seeking approval to continue payment of employee and contractor wages and benefits, honor customer payments and orders and pay suppliers for post-bankruptcy goods and services.

Debt details

According to court documents, High Ridge has $100 million to $500 million in assets and $500 million to $1 billion in debt.

The company’s largest unsecured creditors are Mercer QIF Fund plc – Mercer Investment Fund I of Boston, with a $27.43 million bondholder claim; Barings Global Special Situations 3 Sarl of Charlotte, N.C., with a $26.96 million bondholder claim; Millstreet Credit Fund LP of Boston, with a $22.93 million bondholder claim; Principal Funds, Inc. – Global Diversified Income Fund of Waltham, Mass., with a $15.61 million bondholder claim; JPMorgan Investment Funds – Global High Yield Bond Fund of Indianapolis, with a $10.87 million bondholder claim; Pimco Horseshoe Fund, LP of Newport Beach, Calif., with a $10 million bondholder claim; Barings Global High Yield Credit Strategies Ltd. of Charlotte, N.C., with a $9 million bondholder claim; BMO Capital Markets Corp. of New York, with a $7.7 million bondholder claim; Geode Capital Management LP of Boston, with a $7.43 million bondholder claim; and Caterpillar Inc. Master Retirement Trust of Waltham, Mass., with a $6.5 million bondholder claim.

Debevoise & Plimpton LLP and Young Conaway are serving as the company’s legal counsel. Ankura Consulting Group is serving as restructuring adviser. PJT Partners is serving as financial adviser. High Ridge said Ankura Consulting Group senior managing director M. Benjamin Jones is serving as chief restructuring officer.

High Ridge is a Stamford, Conn.-based personal care products company. The Chapter 11 case number is 19-12689.

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