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Gymboree Gets Court Approval to Exit Bankruptcy, Close 330 Stores

September 11, 2017, 07:51 AM
Filed Under: Bankruptcy

The Gymboree Corporation announced that the United States Bankruptcy Court for the Eastern District of Virginia has confirmed the Company's Plan of Reorganization. Gymboree expects to complete its financial restructuring process and emerge from Chapter 11 by the end of the month, after the conditions of the Plan are satisfied.

Under the terms of the Plan, a comprehensive recapitalization of Gymboree will be completed that will eliminate more than $900 million of debt, establish a sustainable capital structure, right-size the Company's store footprint and position the business for long-term growth and success.

According to court filings, Gymboree is closing and liquidating 330 underperforming stores and will exit Chapter 11 with a $225 million post-bankruptcy credit facility, a $48.5 million exit asset-backed term loan replacement facility and a $35 million exit term loan facility,

"We are very pleased with the Court's approval of our Plan, which marks a major milestone in Gymboree's restructuring process and facilitates a path forward to our emergence as a stronger and more competitive organization," said Daniel Griesemer, President and CEO of Gymboree. "While there is still work ahead to complete the process, we are excited about the future opportunities for Gymboree as we continue to transform the business. The powerful combination of our great brands, a right-sized retail footprint, dedicated employees, and loyal customers are now amplified by the greater financial flexibility the Plan provides."

Griesemer continued, "Today's confirmation is a testament to the hard work of our employees, who have remained focused and dedicated throughout this restructuring process. We also greatly appreciate all of those who helped make this day possible for Gymboree and are grateful for the ongoing support of our customers, vendors, partners and advisors." 

Kirkland & Ellis LLP is serving as the Company's legal counsel, AlixPartners LLP is serving as its financial advisor, and Lazard is serving as its investment bank.

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