Bankruptcy Filing Could Be GNC's Next Step
Payment is due on 16 May to reduce GNC's debt of more than $865m in convertible notes and other credit facilities to less than $50m. "Substantial doubt exists regarding our ability to reduce the" debt to less than $50m, says CFO Tricia Tolivar.
You may also be interested in...
Chapter 11 bankruptcy protection filing positions largest shareholder Harbin Pharmaceutical to acquire full ownership for $760m. But petition also gives it an option of reorganizing with $525m financing if a sale is not completed within 141 days.
Jefferies analysts point out more sales of supplements, particularly sports nutrition products, already were moving online before COVID-19 prompted quarantine orders and spike e-commerce sales. GNC could have capitalized but didn’t have capital available to make its online sales platform and operations large enough to support potential growth.
GNC had faced a springing maturity date of 16 May for payments to reduce its debt of more than $865m in convertible notes and other debts from credit facilities to less than $50m.