FTD and Other Floral and Gifting Businesses Continue to
Operate in the Ordinary Course
Enters Definitive Asset Purchase Agreement with an Affiliate
of Nexus Capital Management to Acquire North America and Latin
America FTD Consumer and Florist Businesses, Including
ProFlowers
Enters Non-Binding Letters of Intent with Potential Acquirors
for Personal Creations and Shari's Berries
Completes Sale of U.K.-Based Interflora
Implements New Operating Model for ProFlowers to Support
Florist Network and Reduce Costs
Receives Commitment for up to Approximately $94.5 Million in DIP Financing to Support
Business
DOWNERS GROVE, Ill.,
June 3, 2019 /PRNewswire/ -- FTD
Companies, Inc. (Nasdaq: FTD) (the "Company"), a premier floral and
gifting company, today announced that the Company and substantially
all of its domestic subsidiaries have filed voluntary petitions
commencing cases under Chapter 11 in the U.S. Bankruptcy Court for
the District of Delaware to
facilitate the completion of strategic initiatives resulting from
the Company's previously announced strategic review. The Company
intends to use the court-supervised restructuring process to
support and protect its ongoing business operations, including its
relationships with member florists and business partners, to
provide an efficient and binding mechanism for the potential sales
of its businesses and to address a near-term debt maturity.
The Company has already made significant progress completing its
strategic initiatives, including:
- Entering into a definitive asset purchase agreement with an
affiliate of Nexus Capital Management LP to acquire FTD's
North America and Latin America
Consumer and Florist businesses, including ProFlowers;
- Entering into a non-binding letter of intent with a strategic
investor to acquire Personal Creations;
- Entering into a non-binding letter of intent with Farids &
Co., LLC, which is owned by Tariq
Farid, founder of Edible Arrangements, LLC, to acquire
Shari's Berries;
- Completing the sale of U.K.-based Interflora to a subsidiary of
The Wonderful Company; and
- Implementing a new operating model for ProFlowers to better
support the FTD florist network and reduce costs by also harnessing
our third-party drop-ship network.
The Company is operating in the ordinary course and remains
focused on supporting its extensive network of member florists and
business partners connected by its iconic FTD brand in North America and Latin America. The Company's other businesses,
including ProFlowers, Shari's Berries and Personal Creations,
are also continuing to provide floral, specialty foods, gifts and
related products to consumers.
"The important actions we are taking today are designed to
enable us to continue supporting our network of florists and
business partners and serving consumers while we work to complete
the initiatives coming out of our strategic review," said
Scott Levin, FTD's President and
Chief Executive Officer. "Over the last several months, we
conducted a robust strategic review to determine the best path
forward for our company. With the advice and support of our outside
advisors, we have initiated this court-supervised
restructuring process to provide an orderly forum to
facilitate sales of our businesses as going concerns and to enable
us to address a near-term debt maturity. Importantly, everyone
involved with this process understands the critical role of our
talented member florists, and we intend to continue supporting them
as normal throughout this process. Our dedicated employees remain
focused on continuing to provide the outstanding customer service
and high level of support our member florists expect from us, and I
thank them for all of their hard work."
The Company has received commitments for up to approximately
$94.5 million in debtor-in-possession
("DIP") financing from a syndicate comprised of its existing
lenders. Upon approval by the Bankruptcy Court, this financing,
combined with cash generated from the Company's ongoing operations,
will be used to, among other things, support the business during
the court-supervised restructuring process.
The Company has filed pleadings, referred to as "first day
motions," with the Bankruptcy Court. The relief sought in the first
day motions is expected to enable the Company to continue to
support its business operations during the restructuring process,
including by continuing payments and services to member florists
and business partners without interruption, managing its continuing
relationships with vendors and customers and paying wages and
benefits for continuing employees.
Entry into Definitive Asset Purchase Agreement for the Sale
of FTD's North America and Latin
America Consumer and Florist Businesses; Shifting ProFlowers
Orders to the FTD Florist Network
The Company has entered into a definitive asset purchase
agreement with an affiliate of Nexus Capital, a California-based private equity sponsor, to
acquire the Company's North
America and Latin America
florist and consumer business, including ProFlowers. The purchase
price is $95 million in cash, subject
to customary adjustments.
The Company also announced that it is restructuring its
ProFlowers business to better support the FTD florist network and
to reduce costs. Under the new operating model, floral order
fulfilment and distribution for ProFlowers are being transitioned
to the FTD florist network and third-party fulfilment partners. The
ProFlowers website will continue to serve customers and process
orders. Under the asset purchase agreement with Nexus Capital,
Nexus Capital would acquire the as-restructured ProFlowers
business.
"We are pleased to announce Nexus Capital's pending acquisition
of our North America and Latin
America Consumer and Florist businesses," said Levin. "We are
excited about the skill, experience and stability that Nexus
Capital brings to the businesses, and we believe this transaction
will serve to enhance FTD's strong relationships with our valued
member florists and business partners. We also believe the shift of
ProFlowers orders into the FTD florist network will benefit our
florist network and key third-party providers, and enable us to
better serve customers. We look forward to continuing our important
relationships with our florist partners."
The asset purchase agreement is subject to certain closing
conditions, including finalizing certain transaction documentation
and related matters by such time as the company seeks approval of
Nexus Capital's stalking horse protections. The asset purchase
agreement also remains subject to higher or better offers for the
North America and Latin America
Consumer and Florist businesses, as well as approval of the
Bankruptcy Court. The Company will seek to close the transaction as
soon as possible in accordance with milestones agreed to with its
DIP lenders.
Potential Asset Sales
The Company has entered into non-binding letters of intent
with:
- a strategic investor to acquire Personal Creations; and
- Farids & Co., LLC, which is owned by Tariq Farid, founder of Edible Arrangements,
LLC, to acquire Shari's Berries.
"We are pleased to have received strong interest for our
businesses and are working diligently to complete our strategic
review initiatives. We believe that our extensive discussions with
multiple parties will enable us to achieve an outcome that benefits
not only our creditors, but also our employees, florists, customers
and partners," said Levin.
The letters of intent for the sales of Personal Creations and
Shari's Berries are subject to the parties reaching definitive
asset purchase agreements that would be implemented through
court-supervised sale processes designed to achieve the most
favorable sale terms for the businesses. The Company will seek to
close these sale transactions as soon as possible in accordance
with milestones agreed to with its DIP lenders. The sale
transactions are subject to Bankruptcy Court approval and the
satisfaction of any other closing conditions set forth in the
definitive agreements.
Sale of Interflora to a Subsidiary of The Wonderful
Company
The Company has sold its Interflora business in the U.K. to a
subsidiary of The Wonderful Company for $59.5 million in cash. The Interflora business
operated independently from FTD's North
America and Latin America
businesses and it is not part of the Chapter 11 filing.
"We are pleased to announce the sale of our Interflora business
in the U.K., which follows a deliberate and robust marketing
process. We are grateful to our Interflora colleagues for their
contributions to our company, and we wish them well under new
ownership," said Levin.
Additional Information
The Company expects that the Company's common stock will be
delisted from the Nasdaq Stock Market for non-compliance with
marketplace rules as a result of the Chapter 11 filing.
In addition, based on the values for the Company's businesses
contemplated by the potential asset sales referred to above, the
Company expects that existing Company stockholders will receive no
recovery at the end of the court-supervised restructuring process,
consistent with legal priorities.
Additional information about the court-supervised restructuring
process is available on the Company's restructuring website,
www.FTDrestructuring.com. In addition, Bankruptcy Court filings and
other information related to the court proceedings are available on
a separate website administered by the Company's claims agent, Omni
Management Group, at www.omnimgt.com/FTD, or by calling Omni
representatives toll-free at 1-866-205-3144 or 1-818-906-8300 for
calls originating outside of the U.S.
Jones Day is serving as legal
advisor to the Company, Moelis & Company LLC and Piper Jaffray & Co. are serving as its
investment bankers and financial advisors, and AP Services, LLC, an
affiliate of AlixPartners, is providing Chief Restructuring Officer
services.
About FTD Companies, Inc.
FTD Companies, Inc. is a premier floral and gifting company.
Through our diversified family of brands, we provide floral,
specialty foods, gifts, and related products to consumers primarily
in North America. We also provide floral products and services
to retail florists and other retail locations throughout these same
geographies. FTD has been delivering flowers since 1910,
and the highly-recognized FTD® brand is supported by the iconic
Mercury Man® logo, which is displayed in over 30,000 floral shops
in more than 125 countries. In addition to FTD, our
diversified portfolio of brands includes the following trademarks:
ProFlowers®, Shari's Berries®, Personal Creations®, Gifts.com™, and
ProPlants®. FTD Companies, Inc. is headquartered
in Downers Grove, Ill. For more information, please
visit www.ftdcompanies.com.
Forward-Looking Statements
This press release contains certain forward-looking statements
within the meaning of the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995, as amended, based on our
current expectations, estimates and projections about our
operations, industry, financial condition, performance, results of
operations, and liquidity. Statements containing words such as
"may," "believe," "anticipate," "expect," "intend," "plan,"
"project," "projections," "business outlook," "estimate," or
similar expressions constitute forward-looking statements. These
forward-looking statements include, but are not limited to,
statements regarding expectations about the timing and execution of
the Company's strategic transactions (including the contemplated
sales of substantially all of the Debtors' assets), the Company's
future financial condition and future business plans and
expectations, including statements related to the effect of, and
our expectations with respect to, the operation of our business,
adequacy of financial resources and commitments, and the operating
expectations during the pendency of the Chapter 11 cases and
impacts to its business related thereto. Potential factors that
could affect such forward-looking statements include, among others,
risks and uncertainties relating to the Chapter 11 cases,
including, but not limited to, the Company's ability to obtain
Bankruptcy Court approval of motions filed in the Chapter 11 cases
(including, but not limited to, the DIP motion and the bidding
procedures motion), the effects of the Chapter 11 cases on the
Company and on the interests of various constituents, Bankruptcy
Court rulings in the Chapter 11 cases and the outcome of the
Chapter 11 cases in general, the length of time the Company will
operate under the Chapter 11 cases, risks associated with
third-party motions in the Chapter 11 cases, the potential adverse
effects of the Chapter 11 cases on the Company's liquidity or
results of operations and increased legal and other professional
costs necessary to execute the Company's restructuring strategy;
the conditions to which the Company's DIP financing is subject and
the risk that these conditions may not be satisfied for various
reasons, including for reasons outside of the Company's control;
the Company's and the Debtors' ability to consummate sales of
substantially all of the Debtors' assets consistent with the
milestones set forth in the interim DIP order of the Bankruptcy
Court and the terms and conditions of any such sales; the Company's
ability to implement operational improvement efficiencies;
uncertainty associated with evaluating and completing any further
strategic or financial alternative as well as the Company's ability
to implement and realize any anticipated benefits associated with
any alternative that may be pursued; the consequences of the
acceleration of our debt obligations; trading price and volatility
of the Company's common stock and the risks related to the
Company's possible delisting from Nasdaq and trading on the OTC
Pink Market and the other factors disclosed in the section entitled
"Risk Factors" in our most recent Annual Report on Form 10-K filed
with the U.S. Securities and Exchange Commission ("SEC"), as
updated from time to time in our subsequent filings with the SEC.
Readers are cautioned not to place undue reliance on these
forward-looking statements, which reflect management's analysis
only as of the date hereof. Such forward-looking statements are not
guarantees of future performance or results and involve risks and
uncertainties that may cause actual performance and results to
differ materially from those predicted. Reported results should not
be considered an indication of future performance. Except as
required by law, we undertake no obligation to publicly release the
results of any revision to these forward-looking statements that
may be made to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events.
Contacts
Michael
Freitag / Aaron Palash /
Aura Reinhard
Joele Frank, Wilkinson Brimmer
Katcher
212-355-4449
View original
content:http://www.prnewswire.com/news-releases/ftd-companies-inc-files-voluntary-chapter-11-petitions-to-facilitate-completion-of-strategic-initiatives-300860381.html
SOURCE FTD Companies, Inc.
