Below is our initial take on recent bankruptcy-related developments:
After Brookfield Corp announced it would be taking control of GoldenPeaks Poland Holding Ltd., the company has filed for Chapter 11 bankruptcy protection in the U.S. along with 40 of its corporate affiliates. The renewables developer has listed total assets between $1 billion and $10 billion with liabilities reported to be in the range of $500 million to $1 billion.
S&K Take: GoldenPeaks Poland, not to be confused with FAT Brands’ subsidiary Twin Peaks (also in bankruptcy, although a different kind of peaks reference), filed in the SD Tex to carve itself out of a larger corporate enterprise. Brookfield, which was a prepetition lender of the company (a solar energy producer unsurprisingly based in Poland) had been propping up the company outside of bankruptcy through emergency financing. When that support ceased, certain non-debtor subs commenced proceedings in Europe. Interestingly, GP Poland decided that the SD Tex was its best bet for a restructuring jurisdiction (who wouldn’t?). So it formed a Texas LLC, funded a retainer and was off to the races. The case is funded by a Brookfield DIP, which was the subject of some negotiation (off the record) with another GP Poland lender, was ultimately approved by Judge Perez on an interim basis. There was also a kerfuffle with some of its former corporate brethren regarding company information. That was resolved through an automatic stay/sanctions threat. GP Poland expects to emerge in 60-90 days. There doesn’t seem to be major acrimony here, so we will revisit if anything interesting pops up.
Mattress manufacturer Sleep Number has filed for Chapter 11 bankruptcy protection as it begins preparations to merge with Sleep Country Canada, a Canadian mattress company. The news comes after Sleep Number reported a $50M quarterly loss but did not disclose how much the merger was worth.
S&K Take: The long-rumored filing of Sleep Number hit the docket last night. The big news? It filed in the SDNY! Mortimer, we’re back! The filing seems to be pretty buttoned up. The Debtors have a $260 million DIP in hand (although that is only $65 million in new money with a 3:1 roll-up), as well as a stalking horse, Sleep Country Canada, coming in with a $415 million cash bid. For those that like to math, the bid is less than the $672.5 million in funded debt. Those stakeholders will be hoping for a robust auction, although the Debtors have proposed a bid deadline of July 8 for competition to surface. That is pretty tight considering summer and holiday weekends. Alas, we will keep an eye on this to see how it evolves.