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Guitar Center Inc. has been cleared to exit bankruptcy with a plan to cut about $800 million in debt and provide the nation’s largest seller of musical instruments with an infusion of cash to navigate the pandemic and holiday shopping season, WSJ Pro Bankruptcy reported. Judge Kevin Huennekens of the U.S. Bankruptcy Court in Richmond, Va., said yesterday that he would confirm Guitar Center’s prepackaged chapter 11 plan, paving the retailer’s path to get in and out of bankruptcy in less than a month. Guitar Center, which entered chapter 11 with more than $1.3 billion in debt, anticipates emerging from bankruptcy as soon as next week, a company lawyer said. Guitar Center’s plan is backed by shareholder Ares Management LLC and co-investors Brigade Capital Management LP, one of the company’s largest bondholders, and the Carlyle Group. Together they agreed to inject $165 million in equity investment into the Westlake Village, Calif., retailer and will own the business after its emergence from bankruptcy.

Tuesday Morning Corp. has struck a settlement with investment firms that had tried to convince fellow trade creditors of the bankrupt off-price retailer to vote against a restructuring proposal, resolving the dispute as the company prepares to exit chapter 11, WSJ Pro Bankruptcy reported. The firms led by Invictus Global Management LLC agreed to drop an appeal, vote in favor of Tuesday Morning’s chapter 11 plan and encourage fellow unsecured creditors to do the same, according to the settlement outlined in papers filed yesterday in U.S. Bankruptcy Court in Dallas. The two sides reached the deal just days after the judge overseeing Tuesday Morning’s bankruptcy ruled the firms published false and misleading information to rally creditor opposition to the restructuring plan and ordered them to be sanctioned. The materials, including the website rejectTuesdayMorningPlan.com, claimed that trade debt would likely get repaid at a higher interest rate if creditors voted against the restructuring plan. Other creditors and Tuesday Morning said that was misleading because the materials didn’t include cautionary information disclosing risks associated with rejecting the plan that was described in official information distributed by the company.

About 40 days after it filed for chapter 11 protection, Lehigh Valley Mall co-owner PREIT has completed its financial restructuring and emerged from bankruptcy, the Allentown, Pa., Morning Call reported. PREIT, the largest mall owner in Philadelphia, filed for chapter 11 on Nov. 1 with a pre-packaged plan to bolster its financial flexibility and restructure its debt, after the coronavirus pandemic wreaked havoc on the brick-and-mortar retail world. Following the expedited process, PREIT said Friday it now has access to up to $130 million of new capital to support its operations. The company’s debt maturity schedule also has been extended.

Ascena Retail Group Inc. has won court approval to sell its Ann Taylor, Lane Bryant, Loft and Lou & Grey retail brands out of bankruptcy to private-equity firm Sycamore Partners in a deal valued at about $1 billion, WSJ Pro Bankruptcy reported. Bankruptcy Judge Kevin Huennekens of the U.S. Bankruptcy Court in Richmond, Va., said yesterday that he would approve the sale of the majority of Ascena’s remaining assets to Sycamore Partners. The private-equity firm, which specializes in retail and consumer investments, had agreed last month to a purchase price of $540 million, subject to certain adjustments, the assumption of some liabilities and other terms. The deal, which could close by next week, will preserve the business as a going concern with at least 900 stores. As of late August, Ascena operated 1,500 retail locations throughout the U.S., down from its previous roughly 2,800 stores.