Milbank has successfully represented an ad hoc committee of secured first lien lenders to FullBeauty Brands Holdings Corp. (together with certain of its affiliates, the “Company”) in connection with the record-setting confirmation of the Company’s prepackaged plan of reorganization as part of voluntary chapter 11 proceedings in the US Bankruptcy Court for the Southern District of New York. The Company filed for bankruptcy protection on February 3, 2019 and, on February 4, 2019, the Bankruptcy Court confirmed the Company’s prepackaged plan of reorganization — less than 24 hours after the Company filed for chapter 11 protection.
The Company is a leading direct-to-consumer retailer in the US plus-size apparel market with over $825.3 million in direct plus-size sales in 2018. As of the date of the bankruptcy filing, the Company’s capital structure consisted of outstanding funded-debt obligations in the aggregate principal amount of approximately $1.3 billion.
Under the plan, ownership of the Company will be handed off to certain of the first lien lenders. In addition, the Company will receive $30 million of new money from certain of the prepetition first lien lenders after reducing outstanding indebtedness by roughly $900 million. Notably, the plan also contemplates that all general unsecured claims will be paid in the ordinary course of business.
Each and every creditor entitled to vote on the plan submitted a ballot to accept the Plan. The remarkable outcome was made possible, in part, by the concessions made by the Ad Hoc Committee of First Lien Lenders, who went the extra mile so that the Company would be in a position to confirm the Plan on an expedited timeframe and avoid unnecessary cost and value degradation.
The Milbank team was led by Financial Restructuring partners Dennis Dunne and Gerard Uzzi and included Leverage Finance partner Marc Hanrahan, Executive Compensation and Employee Benefits partner Mike Shah, Tax partner Russell Kestenbaum, Financial Restructuring associates Nelly Almeida and Paul Springer, Corporate associate Jason Anderson and Tax associate David Hanno.
