Centric Brands, a lifestyle brands collective, emerged from voluntary Chapter 11 proceedings.
Sound Point Capital Management delivered a new securitization facility to the company, which also secured new revolving and term loan facilities from its current lenders.
Ropes & Gray, PJT Partners and Alvarez & Marsal served as legal, financial and restructuring advisors to Centric Brands, respectively.
Centric Brands is now a private entity in partnership with Blackstone, its majority sponsor, Ares Management and HPS Investment Partners.
As part of the restructuring, funds managed by Blackstone and its affiliates exchanged existing second lien debt for controlling equity interests in the reorganized company. Previous senior lenders, funds managed by Ares and HPS retained their senior loan positions and received equity interests in the reorganized company.
In accordance with the company’s restructuring support agreement, Centric Brands reduced its funded indebtedness by approximately $700 million, emerging with a stronger capital structure.
“The completion of this reorganization marks a major milestone for our company. Throughout this process, we operated seamlessly without interruption and remained focused on serving our valued partners. We maintained excellent relationships with licensors and our supply chain – and ultimately delivered to our retailers. We now emerge with an optimized business structure, supportive partners, a qualified and engaged board, and strengthened financials. We look forward to maximizing our potential and creating opportunities for future growth. We wouldn’t be here today without our valued employees and trusted business partners, for whom I am truly appreciative,” Jason Rabin, CEO of Centric Brands, said. “While the impact of COVID-19 has been challenging for our industry, we are very well positioned to navigate the current environment. We will continue leading the industry in our core segments, including kids, accessories, and men’s and women’s denim and lifestyle. With Blackstone’s support, an improved capital structure, strategic relationships, and industry expertise – we are built for a strong future ahead.”