A US bankruptcy court has given approval to Briggs & Stratton receivers to sell the company to private equity firm KPS Capital Partners.
And while this sale will see the 112 year old company continue trading it is a damning result for unsecured creditors with only us$35 to 45 million available to pay them out, meaning they can only expect to receive as little as 7 per cent of their original bill to Briggs.
The approval of the plan makes way for Briggs and KPS to proceed with the transaction they announced on 20 July when the manufacturer filed for Chapter 11 bankruptcy. The sale is expected to be completed by 27 September 2020, if not, the offer will be withdrawn.
More damning for unsecured creditors is the news that sales income and overall financial performance has improved for Briggs since 20 July when the company filed for bankruptcy. And this has provided ample cash for the receivers and advisors to complete their work sooner than expected.
Former company heads at Briggs flagged their disapproval of a sale to KPS, see our full report on 27 July 2020, Briggs files for bankrupcy and follow-up story on 19 August 2020, Briggs creditors seek new plan.