HomePlace secures DIP financing

By Don Hogsett -- Home Textiles Today, 2/19/2001 12:00:00 AM

MYRTLE BEACH, SC -Getting a green light to pay employees and buy more goods to stock its shelves, HomePlace of America Inc. has received U.S. bankruptcy court approval to tap into $155 million in debtor-in-possession (DIP) financing.

The retailer, which filed for Chapter 11 protection from its creditors on Jan. 16, 2001, said it received an okay from the U.S. Bankruptcy Court in Wilmington, DE, to use the new bank financing to keep its operations going. The $155 million in DIP financing is provided by a group of lenders led by Fleet Retail Finance Inc.

Gregory Johnson, president and ceo, said: "This financing, together with the successful completion of strategic restructuring initiatives we announced in conjunction with the filing, will provide adequate funding to support post-petition trade and employee obligations."

As part of a sweeping restructuring already under way, the retailer said it will shutter 38 underperforming units in a move that will affect about 1,500 workers. The retailer will continue to operate 84 stores and three distribution centers.

HomePlace of America is the nation's 19th largest supplier of home textiles, with an estimated $201.9 million in 1999 home fashions sales, according to the Home Textiles Today ranking of the top 50 home textiles retailers, and was produced by the merger of Waccamaw and the already bankrupt HomePlace chain.