As of this past Tuesday, Party City, the party supply titan has officially chosen to file for bankruptcy protection.
Party City Holdco Inc. (PCHI), the parent company, officially filed for Chapter 11 Bankruptcy right along with a few of its domestic subsidiaries, as reported in a Tuesday press release. A number of its other subsidiaries, along with the Anagram business, have seemingly been excluded from the ongoing bankruptcy process. This past November, the company brought in a mainstream financial advisor.
The company also stated that it had been able to make a deal with one ad hoc group in order to assist in its current effort at restructuring and slimming down of its debt. The company expressed that the current restructuring was “[p]re-negotiated” and “[e]xpedited,” and they believe that they will be able to cut down on their overall debt and better utilize the subsequent liquidity. It expressed that it has $150 million from the ad hoc group that will allow it to keep its stores active.
“In the face of pandemic headwinds, a global supply chain crisis, and other macroeconomic challenges that have faced our industry, we have made significant strides in PCHI’s ongoing transformation – establishing a solid foundation for long-term growth and continued success as the market leader in the celebrations space,” explained the Chief Executive Officer of PCHI, Brad Weston, in a release. “Today’s action to strengthen PCHI’s balance sheet will bolster our ability to further advance our strategic priorities and continue to innovate and elevate the customer experience.”
“As we take this important step to put our business on stronger financial footing for the future, we are as committed as ever to inspiring joy by making it easy for our customers to create unforgettable memories. We appreciate the commitment of our team members and the continued support of our partners as we further enhance our position as the ‘go to’ one-stop-shop for celebrating life’s special moments,” explained Weston.
Party City stores are currently still open for those who utilize them, as well as its online storefronts. The company fully anticipates that the ongoing restructuring process will be carried out over the course of the second quarter of the year.
It is also choosing to file a few motions in order to keep up its everyday workings, which involves a number of requests to keep paying its employees and offering them benefits. It is also seeking to “honor customer programs and policies.”