Photo credit: www.investing.com
Big Lots Secures Financing Amid Chapter 11 Bankruptcy Proceedings
(Reuters) – Big Lots, a discount home goods retailer in the U.S., announced on Monday that it has obtained $707.5 million in financing to bolster its operations while simultaneously initiating bankruptcy proceedings under Chapter 11. This significant move comes as the company seeks to sell its business to the private equity firm Nexus Capital.
According to court documents filed in Delaware, Big Lots has listed its assets and liabilities in a range between $1 billion to $10 billion, with the total number of creditors estimated to be between 5,001 and 10,000. This filing highlights the company’s substantial financial challenges.
Nexus Capital is positioned as a “stalking horse bidder” in the upcoming court-supervised auction, a designation that indicates it will make the initial bid for the company’s assets. If Nexus is ultimately chosen as the winning bidder, the transaction is expected to be finalized in the fourth quarter of 2024.
The term “stalking horse bid” refers to an initial bid that sets a minimum threshold for other potential buyers. This strategy aims to stimulate bidding interest by giving a baseline offer that competing bidders must exceed.
In terms of financial performance, Big Lots stated that its results for the second quarter align with earlier guidance. The company is scheduled to publicly disclose its full second-quarter financial results on September 12, having previously postponed the announcement from its original date of September 6.
Big Lots operates approximately 1,400 stores across the United States and employs a workforce of over 30,000. However, the retailer has faced declining sales in recent quarters, adding strain to its financial health and overall operations.
Source
www.investing.com