LOS ANGELES--(BUSINESS WIRE)--Classic Party Rentals, the nation’s leading event rental and services provider, today announced that it has signed an agreement through which substantially all of the business of Event Rentals, Inc. and its subsidiaries, d/b/a Classic Party Rentals, would be acquired by a newly established entity owned by the Company’s current lenders.
“We are very pleased to have reached this sale transaction agreement with our lenders, which we expect will help us more strongly position our company for future growth,” said Jeff Black, Classic Party Rental’s President and Chief Executive Officer. “We believe this agreement demonstrates the confidence that our lenders have in our strategic vision for Classic to continue leading the industry in providing innovative and flawlessly executed event services, and in our leadership’s ability to achieve it. Importantly, our lenders have a deep understanding of our business and are fully supportive of the initiatives critical to our business that we intend to implement in the short and long term. We anticipate that this sale transaction will enable us to put our financial challenges behind us and move forward with a brighter future.
“We intend to accelerate and increase our investment in the business and our people to refresh and grow our inventory, which will expand our ability to deliver even more creative and elaborate events. The terms of our financing commitment provide us with the ability to immediately invest in new inventory ahead of the busy spring and summer event seasons. We look forward to creating and capturing new opportunities for our business, and better serving our customers in the future.”
As previously announced, to facilitate the sale transaction, Classic Party Rentals on February 13 filed voluntary petitions for relief under chapter 11 of the United States Bankruptcy Code. The Company fully expects to operate its overall business as usual and uphold its commitments to stakeholder during the chapter 11 process.
Classic Party Rentals has a commitment for $20 million in debtor-in-possession (“DIP”) financing, which the Company anticipates to be more than sufficient funding during the sale transaction process. Under the terms of the financing agreement, the Company expects to be able to invest an incremental $5 million in new inventory in addition to its ordinary course inventory purchases.
As part of the sale transaction through chapter 11, the agreement is subject to a court-supervised process that will solicit additional offers for Classic Party Rentals to ensure the Company achieves the highest and best offer for its business. Classic Party Rentals will evaluate any competing offers it may receive, and any competing offer accepted would only improve upon the current agreement with lenders.
The transaction is subject to the approval of the Bankruptcy Court and the satisfaction of customary closing conditions. The sale transaction is expected to be completed by the end of May, 2014. Upon completion, Classic Party Rentals will be financially and operationally stronger – with more extensive product and service capabilities and outstanding customer service.
Classic Party Rental's vendors and clients can access additional information about the Company's sale transaction and chapter 11 filing on its dedicated website, www.ClassicTransaction.com. The Company also has established a vendor and customer support center, which may be reached at 877-759-8814 (toll-free), 424-236-7261 (outside of the U.S. or Canada).
Classic Party Rentals is advised in this transaction by Jefferies LLC, FTI Consulting, and White & Case LLP.
About Classic Party Rentals
Classic Party Rentals is the nation’s largest full-service event rental company with over 30 locations nationwide. The company services most major markets including Los Angeles, Chicago, Dallas, New York and Miami by providing china, glassware, flatware, specialty linen, lounge furniture, lighting, heating, flooring and kitchen and catering equipment. Classic is also the leading nationwide provider of tents and clearspan structures under the brand, Classic Tents as well as providing multi-location services within the brand Classic Event Solutions. In addition to providing event rentals, Classic offers sales support and product and event management for more than 150,000 events per year including major sporting events, brand promotion, corporate events, celebrity weddings, charity events and private social events. For more information, please visit www.ClassicPartyRentals.com.