Linens ’n Things Seeks Capital Restructuring
Clifton, N.J. Linens ’n Things said Tuesday it is in talks with creditors on a capital-restructuring plan that could help the retailer avoid bankruptcy.
The home-goods retailer, which was bought by affiliates of the Apollo Global Management firm in 2006 for $1.3 billion, said it is in talks with a committee of debt holders about altering its capital structure. The retailer said it has also delayed a $16.1 million interest payment while the talks continue. Lenders have agreed to delay exercising their right to stop making loans to the company.
According to the retailer’s chief executive Robert DiNicola, "The increasing deterioration of the credit markets, the residential real estate meltdown, and the resulting downturn in consumer spending, especially in the home sector, have combined to create additional and acute financial challenges for the company and the retail sector as a whole."
The retailer posted a net loss of $242.1 million in 2007, based on net sales of $2.79 billion.
Linens ’n Things has until May 13, before its creditors, which include units of General Electric Co., can exercise their rights to withhold loans and other credit extensions.