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The owners of Old Country Buffet, Hometown Buffet and several other all-you-can eat restaurant chains are planning a quick bankruptcy sale for their assets and some of their leases, with hopes to sell them off by the summer, WSJ Pro Bankruptcy reported. San Antonio-based Fresh Acquisitions LLC and Buffets LLC along with several affiliates filed for chapter 11 protection Tuesday, marking the fourth trip through bankruptcy since 2008 for some of the sister chains. Together, the companies owe about $13.5 million in secured debt and more than $5.3 million in unsecured liabilities, according to court papers. The companies said that they filed for bankruptcy again after the Covid-19 pandemic and government-mandated shutdowns disrupted their restaurant operations and severely limited customer demand. Before the pandemic, the companies operated 90 restaurants in 27 states, including other brands such as Furr’s Fresh Buffet, Country Buffet, Ryan’s, Fire Mountain, and Tahoe Joe’s Famous Steakhouse. But the steep decline in sales at the restaurants from occupancy restrictions and the banning of family-style buffet dining forced the companies to close all of their all-you-can-eat locations. The only locations currently open are six Tahoe Joe’s restaurants in California, which had revenue of about $21 million a year before the pandemic, court papers show. Out of their remaining 71 leases, the companies plan to turn over 57 locations to their landlords to stop the continued payment of about $1 million in rent a month. The remaining 14 leases could potentially be transferred through the sale process so that a buyer could use them for future operations. If not, the leased locations could be handed back to the landlords.

Knighthead Capital Management and Certares Management for a second time sweetened their proposal to buy Hertz out of bankruptcy as the rental car company’s board meets to review bids, Bloomberg News reported. The latest plan, which was submitted yesterday, would hand shareholders more value — specifically a 40% stake in the reorganized company through a combination of direct investment and a more than $1 billion equity rights offering. The battle over ownership of Hertz has been heating up. The company earlier this month picked a plan from Centerbridge Partners, Warburg Pincus and Dundon Capital Partners that outbid an earlier Knighthead deal. Last week, Knighthead and Certares responded with a plan that assigned Hertz an enterprise value of around $6.2 billion, paid senior lenders and unsecured bondholders in full, and offered existing equity holders a shot at recovery. The deal was backed by investors including Apollo Global Management Inc. The Centerbridge-led proposal would swap unsecured funded debt claims for 48.2% of the equity in the reorganized company and the right to purchase an additional $1.6 billion of equity. Holders of general unsecured claims would recover around 75 cents on the dollar while existing equity holders would be wiped out. In a court hearing last week, U.S. Bankruptcy Judge Mary Walrath delayed approval of a creditor vote on the Centerbridge-backed reorganization to give Hertz time to consider both proposals.

The U.S. Supreme Court has closed the door on an attempt by creditors of the former Tribune Co. to claw back billions of dollars in shareholder profits that flowed from its 2007 leveraged buyout, about a year before the publisher filed for bankruptcy, WSJ Pro Bankruptcy reported. The justices declined to hear an appeal brought by some Tribune bondholders and retirees, who for more than a decade have been pushing for the right to sue over the buyout. Monday’s decision leaves in place earlier rulings by federal district and appeals courts that rights to pursue legal action over the Tribune buyout under state law were extinguished through the company’s 2008 bankruptcy. Efforts by Tribune creditors to sue billionaire investor Sam Zell and others behind the buyout have been closely followed by bankruptcy professionals and academics. Among those who asked the Supreme Court to take up the appeal was a group of law professors, as well as bankruptcy trustees who have clawed back billions of dollars on behalf of victims of Bernie Madoff and creditors of MF Global Holdings Ltd., Toys “R” Us and Sears Holdings Corp. The law professors broadly argued that lower-court rulings in favor of Tribune shareholders had effectively blessed risky transactions that enrich corporate insiders while loading companies with debt, threatening everyone else the business owes, including retirees dependent on pensions. The Biden administration also weighed in on the appeal. Acting Solicitor General Elizabeth Prelogar said in March that although the Second U.S. Circuit Court of Appeals was wrong when it ruled against Tribune creditors’ state law claims, there isn’t a pressing need for further review of the issue by the Supreme Court at this time.

Only 16 months after Tower Health and Drexel University bought St. Christopher’s Hospital for Children out of bankruptcy, the future of the North Philadelphia safety net institution again hangs in the balance as Tower races to improve its finances or sell hospitals before it runs out of cash, the Philadelphia Inquirer reported. Pressure has mounted to the point that Drexel University president John Fry resigned this month from the Tower board to avoid conflicts of interest as he looks for a way to maintain St. Chris as a crucial teaching location for the Drexel College of Medicine’s third- and fourth-year students. It’s not clear whether a resolution is near, but Temple University Health System, which also uses St. Chris as a teaching location, is also in the mix to run the hospital. “Preserving St. Chris is important for Philadelphia, because it plays a vital role in the city’s health-care network for children. We are currently in discussions to see whether it’s possible for Temple to have a role in doing so,” Temple Health’s chief executive, Mike Young, said Monday. About the time of the St. Chris sale, which was completed in December 2019, executives at Children’s Hospital of Philadelphia expressed a willingness to assist St. Chris’ new owners if asked. It’s not clear whether that ever happened.

KKR & Co. agreed to pay $3.37 billion for a 20% stake in a Sempra Energy unit comprising the U.S. company’s infrastructure assets, including a liquefied natural gas project and a Mexican renewables and pipelines operator, Bloomberg News reported. It’s the latest example of a broader push among U.S. utilities eschewing diversification to focus on providing electricity and gas to homes and businesses. The deal values Sempra Infrastructure Partners at about $25.2 billion, including expected asset-related debt, Sempra said Monday in a statement. Selling the stake also sets a market value for Sempra’s infrastructure unit, said Pavel Molchanov, an analyst at Raymond James. “That means that Sempra’s banks, its lenders, can look at this and perhaps improve how they think about the company’s balance sheet.” The move comes four months after Sempra announced the creation of the new unit to simplify its structure and aid development of gas and renewables projects. The company, which recently announced a $32 billion capital-spending plan focused on its Texas and California utilities, plans to use the proceeds to fund growth of its U.S. utilities and strengthen its balance sheet.

The bones of Brooks Brothers stores are scattered across 100,000 square feet here in a warehouse near the Massachusetts border, mixed in with a sea of cardboard boxes and junk, the New York Times reported. There are legions of mannequins, empty circular tables that once displayed neckties, posters of horseback-riding gentlemen from a bygone era. There is a whole section of Christmas trees and countless gold-painted ornaments of sheep suspended by ribbon — a Brooks Brothers symbol since 1850 known as the Golden Fleece. Blank order forms for tailors are strewn about. A neon sign that apparently still works. There is no apparel, but there are rows of heavy sewing machines that most likely came from one of the brand’s recently shuttered factories. And in the bathroom, a welcome carpet with Brooks Brothers written in cursive sits next to a toilet. The whole mass was abandoned here in the fallout of Brooks Brothers’ bankruptcy filing and sale last year, the scraps of a retailer that made nearly $1 billion in sales in 2019. Ever since, the couple that owns the warehouse, Chip and Rosanna LaBonte, has been scrambling to figure out how to get rid of it all. Junk removal companies have told them it will cost at least $240,000 to clear the space, which Brooks Brothers had rented through November. In order to pay the bill, the LaBontes are going to have to sell their home. The couple’s plight illustrates the far-reaching consequences of retail bankruptcies, which cascaded during the pandemic and affected everyone from factory workers to executives. Smaller vendors and landlords have often been left holding the short end of the stick during lengthy byzantine bankruptcy proceedings, particularly with limits on what they can spend on legal bills compared with larger corporations. And once bankrupt brands are sold, people like the LaBontes are typically left in the dust.

Greensill Capital’s U.S. unit has agreed to sell its Finacity Corp. business to the head of the division for $24 million unless a higher bid comes in at a proposed bankruptcy auction, Bloomberg News reported. Under the tentative deal, which must be approved by a judge, the U.S. unit would sell Finacity to its current president, Adrian Katz. In 2019, Katz and his family owned about 20% of Finacity when Greensill bought it, according to court papers filed Monday. Under that deal, Katz agreed to accept about $21 million in deferred payments that were tied to Finacity’s annual revenue. To buy back the company, Katz has offered to pay $3 million in cash and forgive the $21 million he says he is owed, according to court papers. Should U.S. Bankruptcy Judge Michael E. Wiles approve the proposed sale, Katz’s offer would be a stalking-horse bid at a potential auction. Should no other bids come in, a sale to Katz would become final.

Rival groups of investors are vying for the right to back the expected recovery of Hertz Global Holdings Inc.’s car-rental business and ease a path out of bankruptcy, <em>WSJ Pro Bankruptcy</em> reported. One offer was already on the table when a group led by Centerbridge Partners LP, Warburg Pincus LLC and Dundon Capital Partners stepped up with a competing funding package meant to lift the rental car provider out of bankruptcy. In court papers filed Monday, Hertz said the new offer is competitive with a proposal the company had previously floated to emerge from bankruptcy under the control of Knighthead Capital Management LLC, Certares Management LLC and other co-investors. “This competitive process remains ongoing,” Hertz said, noting that neither group has fully committed to a final deal. An early casualty of the travel-deadening effects of the coronavirus pandemic, Hertz filed for chapter 11 protection in May 2020, its fleets idled and its future prospects uncertain. The competing offers to shepherd the company out of chapter 11 cap months of financing and deal maneuvers that kept Hertz going. Both offers would pay off in full and in cash all senior claims, including bankruptcy financing and first- and second-lien debts, court papers said.

The Roman Catholic Diocese of Rockville Centre has sold its headquarters for $5.2 million — money church officials say will be used to pay creditors, the Associated Press reported. Newsday reports the diocese became the largest in the country last year to declare bankruptcy amid more than 200 lawsuits it faced under New York State’s Child Victims Act. The law opened a so-called lookback window — since extended until August — that allows childhoods victims of sexual abuse to file civil claims beyond statute of limitations restrictions. The diocese, home to 1.4 million Catholics in the Long Island region, sold the five-story pastoral center and an adjacent parking lot to Synergy Holding Partners LLC. Church officials said they decided to sell the headquarters in 2018 after deciding it was no longer cost effective. Sean Dolan, a diocesan spokesman, said Friday that the location of the new headquarters has not been finalized. The diocese also decided to close seven grammar schools over the past year amid declining enrollment and revenue.