The US Bankruptcy Court for the Southern District of New York has approved US retailer Sears Holdings’ first day motions for its voluntary Chapter 11 restructuring.
The retailer filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code yesterday. This approval is expected to improve the company’s liquidity position and allow it to continue business operations throughout the financial restructuring process.
The court authorised the company to access its $300m senior priming debtor-in-possession (DIP) financing from its senior secured asset-based revolving lenders.
In addition, the company was authorised to continue paying employee wages and benefits, as well as to honour member programmes such as warranties and promotions.
Sears Holdings’ chief financial officer Robert A. Riecker said: “The court’s approval of our first day motions is an important step forward in our financial restructuring process, which will allow the company to continue operating in the normal course and provide our customers and members with trusted service.
“Our stores, online and mobile platforms, and related businesses are open and we continue to offer our customers and members the brands and products they want.
“We look forward to continuing to engage in productive discussions with our creditors and other stakeholders to pursue a plan of reorganisation as expeditiously as possible.”
Sears Holdings aims to establish a sustainable capital structure, continue streamlining its operating model and grow profitably through this move.