Bankrupt home-goods retailer Tuesday Morning Corp. has received a $15 million lifeline to support its reorganization effort while its secured lenders push to shut down all 464 of its stores and liquidate its inventory to cash out, WSJ Pro Bankruptcy reported. Judge Edward L. Morris of the U.S. Bankruptcy Court in Dallas on Wednesday allowed investment firm Invictus Global Management LLC to finance the off-price retailer’s bankruptcy process with a $15 million loan, less than a third of the proposed amount of $51.5 million. Judge Morris said the emergency loan is enough to avoid immediate, irreparable harm to the company and its stakeholders until he can determine whether the business has a chance to reorganize under chapter 11 or if it will be better off simply liquidating its inventory. The judge scheduled a hearing in early March to revisit the financing. A restructuring sponsored by Invictus would cut the number of stores by more than half under chapter 11, bringing the company out of bankruptcy with about 200 locations intact. Wells Fargo Bank NA and other secured lenders oppose the retailer’s plans, arguing that an orderly liquidation of inventory would maximize recoveries for creditors compared to a risky reorganization attempt.
