Sunbeam claims 'business as usual'
By Don Hogsett -- Home Textiles Today, 2/12/2001 12:00:00 AM
BOCA RATON, FL -Losing millions, deeply in debt, swamped by shareholder lawsuits and the subject of a government probe, battered Sunbeam Corp. said business will go on as usual as it works its way through bankruptcy and an overhaul of its operations.
The giant home appliance company, the nation's largest producer of automatic blankets, with 2000 blanket sales of about $110 million, filed for bankruptcy protection from its creditors last week in U.S. Bankruptcy Court for the Southern District of New York. The company has been struggling under a burden of about $1.7 billion in bank debt rung up by former chairman and ceo "Chainsaw" Al Dunlap as he made a series of ruinous acquisitions that have virtually crippled the company with debt.
Buying time from the courts and lenders to get its house in order, Sunbeam said it has received a new $285 million line of credit and has also received a commitment from GE Capital Corp. for a new $200 million accounts receivable financing program for its U.S. operations.
Under its bankruptcy plan, Sunbeam said it will convert a large part of its existing bank debt into term debt, convertible debt and stock in the reorganized company. Sunbeam said it expects to emerge from bankruptcy in six to nine months, and in the meantime will conduct its business as usual.
Jerry Levin, installed as chairman and ceo after the ouster of Dunlap, the company's flamboyant and much vilified former ceo, described the bankruptcy filing as an "absolutely necessary decision," and, in fact, Sunbeam's "only option."
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