HUDSON, Ohio - JOANN Inc. (NASDAQ: JOAN), a leading sewing and fabrics retailer, announced today that it has secured a Transaction Support Agreement (TSA) with key financial stakeholders. This move is aimed at strengthening the company's financial position by reducing its funded debt by approximately $505 million and securing around $132 million in new financing and related financial accommodations.
The company, which has been in operation for 80 years and boasts more than 800 stores nationwide, has committed to maintaining business as usual for its employees, vendors, landlords, and other trade creditors. These obligations will be satisfied in full, and services will continue without interruption.
In a statement, Chris DiTullio, Chief Customer Officer and co-lead of the Interim Office of the CEO, expressed confidence in the company's direction and the support from financial stakeholders. Scott Sekella, JOANN’s Chief Financial Officer and co-lead of the Interim Office of the CEO, emphasized that the agreement would provide the necessary financial resources and flexibility to continue offering quality products and services.
The financial restructuring is set to be implemented through a prepackaged court-supervised process, specifically voluntary prepackaged Chapter 11 cases in the U.S. Bankruptcy Court for the District of Delaware. JOANN's stores and its website will remain operational throughout this process. The company anticipates that the restructuring will be completed swiftly, potentially by late April 2024, after which JOANN is expected to become a privately held company, owned by its lenders and industry parties, and its shares will be delisted from Nasdaq.
The company has filed customary motions to ensure uninterrupted operations during the restructuring, which includes continuing to pay wages and benefits to employees and fulfilling obligations to trade vendors.
The information in this article is based on a press release statement.
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