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Anna’s Linens Files for Chapter 11 Bankruptcy Protection

June 16, 2015, 07:49 AM
Filed Under: Bankruptcy

Anna's Linens, Inc., a specialty retailer of value priced home fashions, has filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court, in Santa Ana, CA on Ju.e 14, 2015. The company will continue to operate its business as "debtors-in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court.

The company has negotiated a debtor in possession financing arrangement ("DIP") with Salus Capital, the company's pre-petition lender. Financing from the DIP is expected to provide the company with an immediate source of funds to satisfy the customary obligations associated with the daily operations of its business, including the timely payment of employee wages and delivery of product.

In connection with its Chapter 11 filing, the company has retained the investment bank Wunderlich Securities, and is working to negotiate and execute an approved sale to DW Partners, a multi-strategy fund manager with $6 billion in assets. Although an agency agreement has been executed with Hilco/Gordon Brothers, the parties have agreed to support the DW transaction.

The company is seeking customary authority from the Bankruptcy Court that will enable it to continue to operate and serve its customers. The requested approvals include requests for the authority to make wage and salary payments, continue with various benefits for employees, and honor certain customer programs, such as gift cards and returns on merchandise purchased prior to the bankruptcy filing.

Anna's Linens is a leading specialty retailer offering home textiles, furnishings and décor at attractive prices. Headquartered in Costa Mesa, California, operates a chain of 268 company owned retail stores throughout 19 states in the United States (including Puerto Rico and Washington, D.C.) generates over $300 million in annual revenue and employs a workforce of over 2,500 associates.

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