Tupperware's Bankruptcy Deal Approved by U.S. Judge

By Dietrich Knauth

NEW YORK (Reuters) – A U.S. bankruptcy judge on Tuesday approved Tupperware (NYSE:TUP) Brands' proposal to sell its assets to its lenders, allowing the company to exit bankruptcy with the majority of its operations intact.

U.S. Bankruptcy Judge Brendan Shannon approved the sale at a court hearing in Wilmington, Delaware, stating it was the best available option for Tupperware.

The food storage and kitchen products company had sought a buyer for months prior to its bankruptcy filing, but none were willing to assume the company's $818 million in debt, according to Tupperware attorney Spencer Winters during the hearing.

The lender group acquiring Tupperware includes Stonehill Capital Management Partners and Alden Global Capital, two investment firms that purchased Tupperware debt at significant discounts over the summer, as per Tupperware’s court filings. The lenders are providing $23.5 million in cash along with over $63 million in debt relief.

The sale encompasses Tupperware's brand name and its assets in core markets such as the United States, Canada, Mexico, Brazil, China, Korea, India, and Malaysia. The company intends to scale down operations in certain other markets and transition to a "digital-first, technology-led and asset-light" business model following its emergence from bankruptcy, according to Tupperware CEO Laurie Ann Goldman in a statement last week.

Based in Orlando, Florida, the company filed for Chapter 11 protection last month, aiming to auction its assets in the open market.

However, Tupperware's lenders opposed the company's sale plans, preferring to retain the assets for themselves. The lenders halted the company's access to cash early in the bankruptcy process until both parties reached an agreement.