Wow, it’s August already. But no matter the time of year, Re/Re/Recap is still serving up cool bites of restructuring news. Thanks for joining in.
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What’s that noise? It’s the sound of Muzak parent co. filing Ch 11
Mood Media Corp. filed a prepackaged Chapter 11 bankruptcy (meaning they pre-negotiated the restructuring with their lenders before filing) on July 31, after negotiations starting in late June.
Mood provides licensing for background music, and is the parent company of Muzak, that elevator music company that rose to fame.
This is the second time Mood has filed for bankruptcy in the past three years…
Remington takes a second shot at bankruptcy
Speaking of second chances, the gun-maker filed for its second bankruptcy since 2018 during this past week, despite surging gun sales in the US.
We mentioned in last week’s newsletter that this was a likelihood, especially after the Navajo Nation backed out of talks for a potential acquisition and restructuring.
California Pizza Kitchen files Chapter 11
The national pizza chain filed this past week, and you’ll never guess who their #1 unsecured creditor is. That’s right, my favorite empire, the Simon Property Group. SPG is the landlord of many CPK locations and is owed approximately $2.9M as the pizzeria files.
CNN loves Zombies too! (Pier 1)
If you’ve been staying up on your Re/Re/Recap, you’ll know I’m really interested in the theory of what I call “zombie” businesses: companies that are so propped up by original debt, restructured debt, and other various financial engineering necromancy that it’s almost like they’re not even living breathing cash cows.
CNN wrote a piece this past week about Pier 1 Imports, which is currently in bankruptcy proceedings. In the piece, titled “Bankrupt Pier 1 becomes a walking zombie” they talk about how the store is liquidating brick and mortar but is selling its ecommerce assets to a company who will continue selling products using the brand name online. This is wild for so many reasons, but especially curious to me because “[the new parent company] is co-owned by social media influencer Tai Lopez and Alex Mehr, the co-founder of online dating website Zoosk.”
Time will tell if the Pier 1 brand is strong enough to keep it going online…
Other stuff…
Men’s Warehouse just paid out the classic executive bonus that spells “bankruptcy is on the horizon.” They’re going to like the way that looks once they file, I guarantee it.
PE shops doubling down on debt to pay dividends to themselves? Okay.
On a personal bankruptcy note: “banks are closing credit cards and slashing credit limits amid the pandemic, survey finds”
Noble Corp., offshore oil driller, filed for bankruptcy on Friday, the latest oil player to get hit hard by demand drops due to COVID.