Ailing US supermarket group Bi-Lo has received approval from a US bankruptcy court for financing of US$125m from GE Capital.
Last month, Bi-Lo was forced to apply for Chapter 11 bankruptcy protection as the credit crunch prevented the company from refinancing outstanding loans.
The retailer, which runs 215 stores across four southern US states, said it had made the move “to address an upcoming debt maturity”.
Announcing the credit approval today (6 April), president and CEO Michael Byars said: “We are pleased to have reached this agreement and to have received interim court approval to access this DIP financing. Over the course of the past week, we have evaluated several DIP financing proposals from multiple lenders. The revised agreement we have reached with GE Capital provides us with more liquidity on better overall terms than originally proposed.
Byars added: “While Bi-Lo continues to have significant operational momentum and intends to fund operations primarily through its cash on hand and cash generated from operations, this interim DIP financing further strengthens the company’s financial position. We remain committed to offering our customers the same top quality brands and high quality fresh foods, all at a great value.”