Briggs & Stratton Corp. (BGG) announced Monday that it has filed voluntary petitions under Chapter 11 of the Bankruptcy Code with the United States Bankruptcy Court for the Eastern District of Missouri. It has also filed a motion seeking the designation of KPS Capital Partners, LP (KPS) as the stalking horse bidder in a sale motion as part of the filing.
Briggs & Stratton expects to sell its assets through a court-supervised sale process under Section 363 of the Bankruptcy Code.
Briggs & Stratton also entered into a definitive stock and asset purchase agreement with KPS, whereby an affiliate of KPS has agreed to acquire substantially all of its assets, including equity of foreign subsidiaries, as well as assume certain customer, employee and vendor liabilities for approximately $550 million.
Among other things, the sale agreement is subject to higher or better bids from other potential purchasers.
Briggs & Stratton has also obtained $677.5 million in DIP financing, with $265 million committed by KPS and the remaining $412.5 from its existing group of ABL lenders. Following court approval, the DIP facility will ensure that the Company has sufficient liquidity to continue normal operations and to meet its financial obligations during the Chapter 11 process.
KPS also announced that it has entered into an agreement in principle with the United Steelworkers of America (USW) with respect to a new collective bargaining agreement (CBA) for Briggs & Stratton hourly employees represented by the union at the Company’s manufacturing facilities in Wisconsin. The new CBA, an exclusive agreement between KPS and the USW, will become effective upon completion of the acquisition.
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