A U.S. bankruptcy court judge on Friday approved travel
management company CWT's plan to exit Chapter 11 bankruptcy, one day after the
TMC filed a petition, the company announced Friday. The court's approval
appears to set CWT on a course to complete the financial recapitalization
process it announced in September, including the prepackaged
Chapter 11 filing.
CWT in a statement late Friday said its plan had "the
overwhelming support of CWT’s financial stakeholders" and would eliminate
about half of its debt.
"We are pleased to have received prompt court approval
of the agreement we reached with CWT’s financial stakeholders, which positions
the company for long-term success and provides significant financial resources
to further grow and develop our business," CWT CEO Michelle McKinney
Frymire said in the Friday statement.
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CWT had prepared the prepackaged Chapter 11 bankruptcy
petition to accelerate the closing the restructuring and recapitalization deal,
and filed Thursday in a U.S. bankruptcy court in Texas. A prepackaged process
is one in which debtors and creditors agree to restructuring terms ahead of
filing for Chapter 11. The company in September said the recapitalization deal plan
would replace CWT's existing $1.5 billion debt burden with a new first lien
debt of $625 million and a new undrawn revolving credit facility.
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CWT on Friday said the plan would raise $350 million of new
equity capital into its business, and announced $100 million in product
development, including enhancement of its myCWT travel management platform.
"Having reached this important milestone, we are now
able to move beyond the pandemic and accelerate investments that create
innovative programs and industry-leading experiences, including an enhanced
myCWT platform," McKinney Frymire said in the statement. "As business
travel continues to recover, we look forward to building on our momentum,
continuing to advance our strategic priorities for the benefit of our
customers, partners and other stakeholders, and delivering exceptional
experiences for our customers, travelers and attendees."
The TMC said investment also would be geared toward "augmenting CWT’s existing omni-channel
experience, enabling it to continue its pre-pandemic track record of strong
growth, and enhancing the existing sustainable solutions it provides for its customers
and their travelers," a process that "will include expanding CWT’s
breadth and depth of omni-channel content, travel comparison capabilities,
analytical reporting and choice and availability of sustainable travel
solutions to further enhance the point-of-sale experience for travelers and
carbon footprint details to enable better-informed decision-making."
Further details will be forthcoming, according to CWT.
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