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Anchorage Capital Leads $800MM in New Financing for J.Crew as Retailer Emerges from Chapter 11

September 11, 2020, 09:05 AM
Filed Under: Bankruptcy
Related: Bankruptcy

J.Crew Group announced that it has successfully completed its financial restructuring process and emerged from Chapter 11 well positioned for long-term growth. As part of its financial restructuring, the Company has equitized more than $1.6 billion of secured indebtedness, and Anchorage Capital Group, L.L.C. has become the majority owner of the Company.

To support ongoing operations and future growth initiatives, J.Crew Group is capitalized with a $400 million exit term loan due 2027 provided by Anchorage, as well as GSO Capital Partners LP and Davidson Kempner Capital Management LP, among others. In addition, the Company has access to a new $400 million ABL credit facility due 2025 agented by Bank of America, N.A.

"We are immensely pleased to have completed this process swiftly, and we thank our customers, associates, vendors, and new owners for the dedication and support they have given us these past several months," said Jan Singer, Chief Executive Officer of J.Crew Group. "Looking forward, our strategy is focused on three core pillars: delivering a focused selection of iconic, timeless products; elevating the brand experience to deepen our relationship with customers; and prioritizing frictionless shopping. As a reinvigorated company, we are committed to serving the changing life and style of today's multifaceted consumer and to delivering long term, sustainable results."

"We are energized by the opportunity ahead for the Madewell brand and ready to continue our momentum as we enter into a new phase of growth," said Libby Wadle, Chief Executive Officer of Madewell. "We will remain focused on maintaining our place as a leader in denim and innovating to create a differentiated shopping experience. We are also continuing to grow our offering of everyday essentials and are well positioned to lead the casualization trend offering our customers clothes they want to wear now."

"J.Crew and Madewell's ability to pair timeless classics with modern, fresh designs will never go out of style, and we intend to continue the legacies of these two iconic American brands with deeply loyal customers and strong, creative leadership teams," said Kevin Ulrich, Chief Executive Officer of Anchorage. "We see an immense opportunity for growth and expansion at each brand and are confident their existing robust direct-to-consumer and e-commerce platforms will position the Company to succeed in today's evolving retail landscape. We look forward to working with Jan, Libby, and the entire leadership team."

Weil, Gotshal & Manges LLP served as legal counsel, Lazard served as investment banker, and AlixPartners, LLP served as restructuring advisor to J.Crew Group. Anchorage and other members of an ad hoc committee were represented by Milbank LLP as legal counsel and PJT Partners LP as investment banker. BofA Securities, Inc., JPMorgan Chase Bank, N.A., and MUFG Union Bank, N.A. served as joint lead arrangers and joint bookrunners for the new ABL credit facility.

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