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CEC Entertainment Inc., parent company of Chuck E. Cheese, files for Chapter 11
On Wednesday 6/24, Chuck E. Cheese entered Chapter 11, woefully undercapitalized with $1.7b in assets and $2.0b in total debt.
Private equity owner Apollo Global Management took the company private in 2014 and saddled Chuck up with debt. True to it’s private equity form, after a five-year holding period, Apollo tried to sell the company in 2019 but was unsuccessful, and like a kid asking their parents for more quarters to extend a particularly successful streak in skee-ball, convinced some lenders to refinance.
Now, as restaurant closures erode cash availability, and on fully-drawn revolvers, CEC is turning to bankruptcy to shed debt and streamline operations.
This coverage was interesting - who knew that Chuck was started by the guy who invented Pong?
GNC lenders swallow pill: agree to prepackaged Chapter 11 sale
The health and wellness nutritional supplement company may be sold to Harbin Pharmaceutical Group for a sum of approximately $760m. Through the restructuring process, GNC plans to close over 800 of its 5,200 stores across the United States.
The bankruptcy process allows GNC to exit store agreements in locations that are loosing their shine (looking at you, B-tier malls) as the company faces competition from online supplement retailers and expanding nutrition sections at grocers and retailers.
If the company doesn’t emerge from Chapter 11 within a year, executives will have to return 25% of their big pre-bankruptcy bonuses…
Miscellaneous bits and bobs
Ready, aim: Gun-maker Remington considers Chapter 11 for the second time since 2018… and a prepack sale to the Navajo Nation.
Restructuring comes to retailers near you: coverage and infographic from yahoo!