School Specialty announced that the U.S. Bankruptcy Court for the District of Delaware issued an order preliminarily approving the company’s disclosure statement and authorized the company to begin soliciting approval for its amended joint plan of reorganization from its creditor groups. Under the plan, School Specialty will emerge from Chapter 11 as a stand-alone company.

Based on preliminary indications of interest, the company currently believes that it will receive commitments for exit financing that will be used to partially repay lenders of the debtor-in-possession financing, outstanding claims per the plan’s distribution formulas, and fund ongoing operations within the current proposed timetable for emergence.

If the company’s plan of reorganization is confirmed as proposed, existing common stock will be extinguished under the plan, and no distributions will be made to holders of the company’s current equity.

Previously on abfjournal.com:

Bayside Capital to Acquire Assets of School Specialty, Monday, January 28, 2013