FTD Companies files voluntary Chapter 11 petitions
FTD Companies announced that the company and substantially all of its domestic subsidiaries have filed voluntary petitions commencing cases under Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware to facilitate the completion of strategic initiatives resulting from the company's previously announced strategic review. The company intends to use the court-supervised restructuring process to support and protect its ongoing business operations, including its relationships with member florists and business partners, to provide an efficient and binding mechanism for the potential sales of its businesses and to address a near-term debt maturity. The company is operating in the ordinary course and remains focused on supporting its extensive network of member florists and business partners connected by its iconic FTD brand in North America and Latin America. The company's other businesses, including ProFlowers, Shari's Berries and Personal Creations, are also continuing to provide floral, specialty foods, gifts and related products to consumers. The company has received commitments for up to approximately $94.5M in debtor-in-possession, or DIP, financing from a syndicate comprised of its existing lenders. Upon approval by the Bankruptcy Court, this financing, combined with cash generated from the company's ongoing operations, will be used to, among other things, support the business during the court-supervised restructuring process. The company has filed pleadings, referred to as "first day motions," with the Bankruptcy Court. The relief sought in the first day motions is expected to enable the company to continue to support its business operations during the restructuring process, including by continuing payments and services to member florists and business partners without interruption, managing its continuing relationships with vendors and customers and paying wages and benefits for continuing employees. The company has entered into a definitive asset purchase agreement with an affiliate of Nexus Capital, a California-based private equity sponsor, to acquire the company's North America and Latin America florist and consumer business, including ProFlowers. The purchase price is $95M in cash, subject to customary adjustments. The company also announced that it is restructuring its ProFlowers business to better support the FTD florist network and to reduce costs. Under the new operating model, floral order fulfilment and distribution for ProFlowers are being transitioned to the FTD florist network and third-party fulfilment partners. The ProFlowers website will continue to serve customers and process orders. Under the asset purchase agreement with Nexus Capital, Nexus Capital would acquire the as-restructured ProFlowers business. The company has sold its Interflora business in the U.K. to a subsidiary of The Wonderful Company for $59.5M in cash. The Interflora business operated independently from FTD's North America and Latin America businesses and it is not part of the Chapter 11 filing.