(Filed Under wholesale Lingerie News). As Peekay, the intimate apparel and adult products retailer, moves closer to emerging from bankruptcy, court filings have revealed details of how the process will take place as well as the names of certain trade creditors.
The 46-store chain was assembled by investors by cobbling together separate smaller retailers. During the process substantial debt was incurred, which, at the time of the bankruptcy filing in early August, had swelled to over $50 million. Since the bankruptcy was announced additional trade claims have been received by the court.
An un-named “stalking horse” bid for the company has been secured, and the court is seeking additional competing bids, with a deadline of October 10. The court is looking for offers of $30.1 million or more. Post bankruptcy ownership of Peekay should be resolved before the end of October.
Trade creditors that have filed claims with the court include Fun Factory USA, claiming $125,481.17; Dreamland Brands, claiming $3,254.40; Sliquid, claiming $4,858.20; Interactive Life Forms, claiming $25,989.10; Amuzement Enterprise, claiming $23,672.25; Sportsheets, claiming $16,090.82; Uberlube, claiming $2,850.00; Valencia Naturals, claiming $7,846.56; Adventure Industries, claiming $41,699.23; Shirley of Hollywood, claiming $12,575.34; Lelo, claiming $199,576.71; Comme-Ci Comme-Ca, claiming $2,630.57; Dreamgirl, claiming $132,484.28; Givex USA, claiming $45,393.77; Health Devices, claiming $79,006.23; and Kamsut, claiming $59,836.50.
According to court documents, trade creditors will receive, as part of the bankruptcy process, 20% of their claim.
Court filings describe the tortured efforts of Peekay and various executives over several years to find a way to avoid the bankruptcy. Albert Altro, the company’s chief restructuring officer, wrote, “Beginning in May 2015, the company and its professional advisors engaged in multiple restructuring initiatives to address the company’s balance sheet, including exploring an initial public offering of the company’s stock, multiple out-of-court restructuring proposals, and an extensive marketing and sale process to find a purchaser for the company’s
assets. Indeed, in connection with the marketing and sale process, which began in March 2016 (i.e., more than 17 months ago), the company and its advisors contacted over one hundred fifty one (151) potential buyers, executed sixty three (63) non-disclosure agreements and provided diligence to numerous potential buyers. The foregoing resulted in eight (8) letters of intent, the most recent of which was entered into in May 2017. Ultimately, however, no executable transaction came from these extensive marketing efforts, including the most recent letter of intent, which terminated in July 2017, precipitating these Chapter 1l cases.” — NM
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