I.B.C., GE Capital agree on credit facility
January 27, 2009
by Jeff Gelski
KANSAS CITY – Interstate Bakeries Corp. and GE Capital Corp. have agreed in principle on key terms for a revised asset-based revolving credit financing facility, I.B.C. said Jan. 26.
"We are optimistic that we will emerge from Chapter 11 in the near future," said Craig Jung, chief executive officer for Kansas City-based I.B.C., which has been in Chapter 11 bankruptcy since September of 2004.
I.B.C. filed a motion with a bankruptcy court seeking approval to close on the amended terms of the facility. The company expects to have a hearing on the motion on Thursday, Jan. 29, but it cautioned it could give no assurance that its exit financing will close as expected. The company’s existing debtor-in-possession financing matures on Feb. 9, and its exit financing commitments expire on the same date.
"Given today’s challenging credit markets, our road to emergence from Chapter 11 has been longer and more challenging than anticipated, but we have now reached the final stretch," Mr. Jung said. "While much work remains to be done to close our financing transactions, we believe that our accord with GE Capital has cleared the last significant obstacle to our emergence.
"Negotiations with GE Capital over the past several days have been constructive, and so I am optimistic we will have a timely completion of this transaction."
General Electric Capital Corp. and GE Capital Markets had agreed to provide $125 million in revolving credit to I.B.C.