Togut, Segal & Segal LLP is pleased to announce that it along with the debtors’ other retained professionals, Meyer, Suozzi, English & Klein, P.C., SSG Advisors, LLC, and BDO USA, LLP, have been awarded the 2021 Chapter 11 Restructuring of the Year by Turnaround Atlas Awards for their work on the chapter 11 cases of Rubie’s Costume Company and its affiliated debtors. Turnaround Atlas Awards is part of the prestigious M&A Atlas Award’s global brand, which honors legendary leaders, top professionals, outstanding firms, and best value-creating transactions from the global restructuring, insolvency and distressed investing communities.
On March 18, 2021, the United States Bankruptcy Court for the Eastern District of New York confirmed a fully consensual chapter 11 plan of liquidation for Rubie’s Costume Company, Inc. and its affiliated debtors, a 65-year old family-owned company based in Melville, New York, and the world’s largest designers, manufacturers, and distributors of costumes and related accessories. Bankruptcy Judge Alan Trust called the cases a “remarkable achievement,” and counsel for the creditors’ committee applauded the debtors in working closely and cooperatively to obtain a tremendous result for the estates.
Under the chapter 11 plan, priority and administrative claims will be paid in full in cash and general unsecured creditors are expected to recover not less than 40% on their claims. At the time of filing, the debtors had approximately $28 million in unsecured trade and other payables. As a result of orders entered in the early stages of the case authorizing the debtors to pay critical vendors and other claims, it is estimated that the return to unsecured creditors, when combined with the current estimated distributions under the chapter 11 plan, will be approximately 75%.
Prior to confirmation, the Togut Firm and the debtors’ other retained professionals assisted the debtors with selling substantially all of their assets in a section 363 sale following an expedited three-month in-court process. The sale enabled the debtors to satisfy nearly $100 million of secured debt, have the purchaser assume approximately $35 million in postpetition trade payables, and save hundreds of jobs.