Instant Brands receives approval of DIP financing, bid procedures

By Sarah Lizee

Olympia, Wash., July 13 – Instant Brands received final approval of its $257.5 million debtor-in-possession financing package, according to an order filed Thursday with the U.S. Bankruptcy Court for the Southern District of Texas.

As previously reported, the DIP financing includes a $132.5 million new-money term loan facility and a $125 million rollup of asset-based lending facility debt.

The DIP agent for the new-money term loan is Wilmington Trust, NA.

Interest on the new money is SOFR plus 1,000 basis points per annum.

For each interest period, the borrower will pay-in-kind, in lieu of cash payment, a portion of the interest accrued during such interest period in respect of any loans equal to 7% per annum.

There is a 5% commitment fee and a 10% backstop fee on the new money.

The rollup consists of a $105 million first-out tranche A, a $12 million last-out tranche B-1 and an $8 million last-out tranche B-3.

Bank of America, NA is the DIP agent on the rollup.

Interest on the rollup is SOFR plus 400 bps for tranche A loans, SOFR plus 500 bps for tranche B-1 loans and SOFR plus 600 bps for tranche B-3 loans.

Bid procedures

The company also received approval of the bid procedures for its assets.

As background, the debtors started their Chapter 11 cases to pursue one or more sale transactions or a standalone restructuring.

After considering strategic alternatives and negotiating with stakeholders and counterparties, the debtors and their advisers decided that a sale of all or some of the assets would be a potential path to maximizing and preserving value for the benefit of the debtors’ stakeholders, Instant Brands said.

The bid deadline is 4 p.m. ET on Sept. 7, an auction is scheduled for Sept. 11, and a sale hearing will take place on Sept. 14.

The company also received approval to choose a stalking horse bidder and provide an up to 3% breakup fee and an up to $500,000 expense reimbursement.

Guggenheim Securities, LLC is acting as investment banker.

Instant Brands is a Downers Grove, Ill.-based manufacturer of kitchen and houseware brands, such as Instant Pot, Pyrex, Corelle, CorningWare, SnapWare, Chicago Cutlery and Visions. The company filed bankruptcy on June 12 under Chapter 11 case number 23-90716.

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