03.04.2017, 19:24
Angelica Corporation Enters into Asset Purchase Agreement with KKR
OREANDA-NEWS. Angelica Corporation ("Angelica" or the "Company"), the leader in healthcare linen and medical laundry services, today announced that it has entered into an asset purchase agreement ("APA") with an entity affiliated with KKR, under which the KKR affiliate will acquire substantially all of Angelica's assets as a going concern in a transaction valued at approximately $125 million plus certain assumed liabilities.
KKR is a leading global investment firm with substantial resources and a proven record of investing in market-leading businesses. It partners with companies and management teams to help them achieve outstanding operating and financial results. KKR is a long-term investor and it intends to build on Angelica's success and help the Company continue to grow.
Under the terms of the APA, the KKR affiliate will serve as the "stalking horse bidder" in a court-supervised sale process. To facilitate the sale process, Angelica today filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York. Angelica intends to conduct the sale process pursuant to Section 363 of the Bankruptcy Code. Accordingly, the APA is subject to higher and better offers, among other conditions.
Angelica expects to continue operating as normal throughout this process.
"We believe the actions we are taking will strengthen our financial foundation and allow Angelica to serve our customers better," said David A. Van Vliet, President and CEO of Angelica. "Over the last several months, we undertook a comprehensive review of our strategic options with the support of our private equity investors and with the help of our outside advisors. The decision to pursue a court-supervised sale of our business as a going concern is the culmination of this process, and we believe it will provide Angelica with financial flexibility and the resources needed to invest and grow."
Mr. Van Vliet continued, "Angelica's operations are strong and will continue to operate as normal throughout this court-supervised process. We are the leading provider of linen services to the healthcare industry, serving more than 3,800 hospitals, clinics, and long-term care facilities across the country. In light of industry-wide challenges, we have made critical investments in our business over the last several months. I want to thank our employees for their hard work and commitment to serving our customers, who will continue to be the true driver of Angelica's future success."
Rony Ma, Principal on KKR's Credit team, said, "We are pleased to enter into this agreement with Angelica, an industry leader with a national footprint and long-term partnerships with key customers. We believe that its pioneering, comprehensive technology solutions and best-in-class service provide a strong foundation for future growth. Once this process is completed, we look forward to working with the Angelica management team and all of its dedicated employees to build on Angelica's success."
KKR is primarily making the investment through funds affiliated with its Direct Lending strategy.
In conjunction with the proposed transaction, Angelica is seeking court approval of a $65 million "debtor in possesion" financing facility from Wells Fargo Capital Finance, LLC to support the Company's continued operations during the court-supervised sale process.
The Company has filed a number of customary motions seeking court authorization to continue to support its business operations during the court-supervised sale process, including the continued payment of employee wages and benefits without interruption. The Company intends to pay suppliers in full under normal terms for goods and services provided after the filing date of April 3, 2017. The Company expects to receive court approval for these requests.
KKR is a leading global investment firm with substantial resources and a proven record of investing in market-leading businesses. It partners with companies and management teams to help them achieve outstanding operating and financial results. KKR is a long-term investor and it intends to build on Angelica's success and help the Company continue to grow.
Under the terms of the APA, the KKR affiliate will serve as the "stalking horse bidder" in a court-supervised sale process. To facilitate the sale process, Angelica today filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York. Angelica intends to conduct the sale process pursuant to Section 363 of the Bankruptcy Code. Accordingly, the APA is subject to higher and better offers, among other conditions.
Angelica expects to continue operating as normal throughout this process.
"We believe the actions we are taking will strengthen our financial foundation and allow Angelica to serve our customers better," said David A. Van Vliet, President and CEO of Angelica. "Over the last several months, we undertook a comprehensive review of our strategic options with the support of our private equity investors and with the help of our outside advisors. The decision to pursue a court-supervised sale of our business as a going concern is the culmination of this process, and we believe it will provide Angelica with financial flexibility and the resources needed to invest and grow."
Mr. Van Vliet continued, "Angelica's operations are strong and will continue to operate as normal throughout this court-supervised process. We are the leading provider of linen services to the healthcare industry, serving more than 3,800 hospitals, clinics, and long-term care facilities across the country. In light of industry-wide challenges, we have made critical investments in our business over the last several months. I want to thank our employees for their hard work and commitment to serving our customers, who will continue to be the true driver of Angelica's future success."
Rony Ma, Principal on KKR's Credit team, said, "We are pleased to enter into this agreement with Angelica, an industry leader with a national footprint and long-term partnerships with key customers. We believe that its pioneering, comprehensive technology solutions and best-in-class service provide a strong foundation for future growth. Once this process is completed, we look forward to working with the Angelica management team and all of its dedicated employees to build on Angelica's success."
KKR is primarily making the investment through funds affiliated with its Direct Lending strategy.
In conjunction with the proposed transaction, Angelica is seeking court approval of a $65 million "debtor in possesion" financing facility from Wells Fargo Capital Finance, LLC to support the Company's continued operations during the court-supervised sale process.
The Company has filed a number of customary motions seeking court authorization to continue to support its business operations during the court-supervised sale process, including the continued payment of employee wages and benefits without interruption. The Company intends to pay suppliers in full under normal terms for goods and services provided after the filing date of April 3, 2017. The Company expects to receive court approval for these requests.
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