Advertisement

DirectBuy Bankruptcy Dismissal Approved

Advertisement

The U.S. Bankruptcy Court issued an order dismissing the DirectBuy Holdings’ Chapter 11 case and granting related relief. The Debtor’s dismissal motion previously argued, “The Debtors commenced these Chapter 11 cases to preserve their business as a going concern and maximize the value of their assets through a sale transaction. The Debtors achieved that goal and, in February, 2017, closed a sale of substantially all of their business assets. After the closing, the Debtors, Committee and Pre-Petition Secured Parties entered into a settlement that enabled the Debtors to pay administrative expense claims not assumed in connection with the sale and otherwise administer these Chapter 11 cases. That settlement positioned the Debtors to exit from Chapter 11. As this juncture, the Debtors and the Committee have discussed the most efficient way to conclude the Chapter 11 Cases.”

In addition, “After carefully considering the alternatives, and given the completion of the sale and the lack of any remaining assets to monetize, the Debtors have decided that dismissal is the most effective way to proceed as they are unable to propose and confirm a plan. In any event, confirmation of a plan of liquidation will take too long, be too expensive and substantially increase administrative costs. Conversion of these cases to Chapter 7 merely will add another layer of administrative expenses without any benefit to the Debtor’s unsecured creditors.”

The Company concluded, “Based on these circumstances, dismissal makes the most practical and economic sense.” According to the docket, header the formal dismissal date for this case will be August 29, 2017. This housewares’ retailer filed for Chapter 11 protection on November 1, 2016, listing $29 million in pre-petition assets.

Read more DirectBuy retail bankruptcy news.