Legal
Franchise Group Approved to Borrow $250 Million in Bankruptcy
- Firm backed by B. Riley to reorganize in deal with lenders
- Junior lenders fight plan to hand company to senior creditors
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Franchise Group Inc. won temporary court permission to borrow as much as $250 million from its senior lenders in order to keep operating while the bankrupt, brand management firm tries to cut debt and sell itself.
Bankruptcy Judge John Dorsey overruled objections from two lower ranking creditors — bond-giant Pacific Investment Management Co. and Irradiant Partners LP — who said they were willing to provide an alternative loan with fewer fees and a lower interest rate, but would not give Franchise as much cash as the company needs to get through its Chapter 11 case.