CHARLOTTE, N.C. (WIS) - One of the more popular retailers in the Southeast is expected to file for bankruptcy.
On Tuesday, Belk announced it entered a “Restructuring Support Agreement” with Sycamore Partners in an effort to reduce debt.
“Belk has a 130-year legacy of providing quality products at great prices,” said Belk CEO Lisa Harper. “Like all retailers navigating COVID-19, our priority has been the safety of our associates, customers, and communities. As the ongoing effects of the pandemic have continued, we’ve been assessing potential options to protect our future. We’re confident that this agreement puts us on the right long-term path toward significantly reducing our debt and providing us with greater financial flexibility to meet our obligations and to continue investing in our business, including further enhancements and additions to Belk’s omnichannel capabilities.”
Under the agreement, Belk aims to recapitalize its business, significantly reduce debt by about $450 million, and extend maturities on all term loans to July 2025.
Belk has also received financing commitments for $225 million in new capital from Sycamore Partners, investments firms KKR and Blackstone Credit, and certain existing first lien term lenders.
Belk is also expected to file for bankruptcy, according to a press release sent out Tuesday.
However, the company says stores and business operations will continue as normal and suppliers will be unimpaired and will continue to be paid “in the ordinary course for all goods and services.”
Belk previously furloughed workers in March and laid off several of its employees back in July due to the pandemic.
Currently, Belk has nearly 300 locations in 16 states. Of those, 35 are in South Carolina.