The U.S. Bankruptcy Court granted Performance Sports Group’s motion to approve certain corporate restructuring transactions in connection with the Debtors’ going-concern sale.
As previously reported, “The Pre-Closing Reorganization is necessary to minimize the possibility of an estimated Cdn $10 million or more in potential tax liability on the sale of the Debtors’ assets, ensures that assets in European legal structures are appropriately repatriated to the Debtors’ estates, and satisfies intercompany payables and receivables between certain of the Debtors incorporated in Canada and foreign non-Debtor entities that will be acquired by the purchaser….The Debtors entered into an agreement (the ‘Stalking Horse Agreement’) for the going-concern sale of substantially all of the Company’s assets (the ‘Stalking Horse Sale’) to a group of investors led by Sagard Capital Partners, (collectively, the ‘Stalking Horse Purchaser’), subject to a Court supervised auction process. Pursuant to the Stalking Horse Agreement, the Stalking Horse Purchaser has agreed to acquire substantially all of the Debtors’ assets for the base purchase price of U.S. $575 million, plus the assumption of related operating liabilities, and serve as a ‘stalking horse’ bidder in the Bankruptcy Proceedings (collectively, the ‘Stalking Horse Consideration’).”
In addition, “Luxco has a loan payable to Amalco in the amount of $247 million (the ‘BHC Note’). Luxco has a loan receivable from U.S. Debtor in the amount of $250 million (the ‘BPS US Note’). Luxco also has an upstream loan payable to Amalco in the amount of $420,626. ii) Luxco will repay the BHC Note (a) in kind by transferring $247 million of the BPS US Note to Amalco and (b) repaying $3 million of capital to Amalco by distributing the remaining $3 million of the BPS US Note. iii) Luxco will pay an in-kind dividend equal to the amount of the upstream loan (i.e., $420,626) to Amalco.”
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