Guilford files Ch. 11; refinances debt

By Staff -- Home Textiles Today, 3/5/2002 12:00:00 AM

Greensboro, NC — Guilford Mills announced today that it had filed for a pre-arranged Chapter 11 bankruptcy protection after reaching an agreement with senior lenders to refinance its $270 million in debt.

According to the company, the debt will be reduced to approximately $145 million and the unsecured trade creditors will be paid in full. Some company lenders will also provide $30 million debtor-in-possession revolving credit.

All existing shares of common stock will be cancelled and new shares will be issued. Lenders will receive 90 percent of the company's equity leaving shareholders with the remaining 10 percent.