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Catalina Marketing wins confirmation of pre-packaged Chapter 11 plan
By Caroline Salls
Pittsburgh, Jan. 31 – Catalina Marketing Corp.’s pre-packaged plan of reorganization was confirmed on Thursday by the U.S. Bankruptcy Court for the District of Delaware.
As previously reported, Catalina reached an agreement with more than 90% of the company’s first-lien lenders and more than 75% of its second-lien lenders on the terms of a restructuring support agreement to restructure its balance sheet.
The disclosure statement for the company’s pre-packaged plan of reorganization said the restructuring will leave the Catalina debtors’ businesses intact and will substantially deleverage their capital structure.
Specifically, balance sheet liabilities will be reduced to $281 million in secured debt from $1.9 billion in secured and unsecured debt, representing an 85% debt reduction.
Catalina said this deleveraging will enhance the debtors’ long-term growth prospects and competitive position and allow it to emerge from the Chapter 11 cases as a stronger company, better positioned to deliver value to its customers.
The plan calls for the distribution of new common stock to pre-bankruptcy secured lenders, with 90% to be allocated on account of first-lien debt claims and 10% on account of second-lien debt claims, each subject to dilution by a management incentive plan.
There will be no impairment to the debtors’ other creditors, except specified rejection claims and general unsecured PDM claims. Creditors in both of those classes will receive no distribution.
Other general unsecured claims will continue to be paid or disputed as if the Chapter 11 filing never occurred.
Existing equity interests will be cancelled.
Catalina is a St. Petersburg, Fla.-based provider of personalized digital media. The company filed bankruptcy on Dec. 12 under Chapter 11 case number 18-12794.
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