Spectrum Brands disclosure statement OK'd; confirmation hearing set

By Caroline Salls

Pittsburgh, April 15 - Spectrum Brands, Inc. received court approval of the disclosure statement for its pre-packaged plan of reorganization, according to a company news release.

The plan confirmation hearing is scheduled for June 15. Spectrum said it expects to emerge from bankruptcy by late summer.

The company said it will now begin soliciting votes from its senior term lenders and noteholders.

As previously reported, the company reached agreements with noteholders representing roughly 70% of the face value of its outstanding bonds regarding a refinancing that will enable the company to reduce the amount of debt on its balance sheet by about $840 million, eliminate $95 million in annual cash interest payments and free up additional cash that could be reinvested in its business to support meaningful revenue and profit growth.

Under the proposed pre-packaged plan of reorganization:

• All of the company's $1.05 billion in existing note obligations will be exchanged for new common stock and a new series of senior subordinated notes of the reorganized company;

• No distributions will be made to holders of the company's current equity; and

• The claims of existing creditors other than the noteholders will be reinstated and unimpaired.

Based on preliminary indications of interest, the company said it believes it will be able to receive commitments for exit financing within the proposed timetable for emergence.

Spectrum Brands is an Atlanta-based consumer products company and supplier of batteries, lawn and garden products, pet supplies, shaving and grooming products, household insect control products, personal care products and portable lighting.

The company filed for bankruptcy on Feb. 3. Its Chapter 11 case number is 09-50455.

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