Loehmann’s Capital Corp., which operates the Loehmann’s nameplate, expects to exit bankruptcy proceedings by March 1.
A Manhattan bankruptcy court on Monday confirmed the company’s joint plan of reorganization, paving the way for its exit from Chapter 11 protection subject to its finalizing the terms for a $45 million exit financing facility.
Loehmann’s said, “The plan was overwhelmingly supported and accepted by the company’s creditors who voted. The implementation of the plan will enable Loehmann’s to continue operating as normal.”
Loehmann’s has 40 stores open in 11 states and in the District of Columbia.
The company filed a voluntary prepackaged Chapter 11 petition on Nov. 15, its second tour of bankruptcy proceedings. The firm previously filed in May 1999, exited bankruptcy court protection in October 2000 and was subsequently acquired by Istithmar Retail Investments in July 2006 for $300 million.
At the time of its November filing, Whippoorwill Associates and Istithmar agreed to invest $25 million into Loehmann’s Capital’s emergence from bankruptcy. Whippoorwill owns 70 percent of the senior notes, and Istithmar is the equity sponsor.
The company was founded by Frieda Loehmann, a former department store buyer, in 1921 in Brooklyn, N.Y. Previous owners include May Department Stores Co.
Any company that is reorganizing needs to ensure all its employees know what is going on throughout the reorganization in the case it affects their job and job security. Being an employee in that situation can be tough since you may not know if the company will still be a company in six months.