(Bloomberg) — Shipping company Pitney Bowes Inc. has agreed to liquidate a large portion of its e-commerce business in bankruptcy as part of two deals with Hilco Global and bondholder Oaktree Capital Management.
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Under the deal, Hilco affiliates agreed to buy a controlling stake in the e-commerce business and then sell it in installments, according to a statement from Pitney Bowes. Oak Tree, which holds bonds issued by Pitney as well as secured claims against the e-commerce units, agreed to support the bankruptcy case, according to court records and regulatory filings.
The e-commerce entities filed for Chapter 11 bankruptcy on Thursday, listing debts and assets of up to $500 million each.
Companies typically use Chapter 11 to reorganize and continue operating, but it can also allow for an orderly liquidation.
Pitney said the company’s global e-commerce business lost $136 million last year. Interim CEO Lance Rosenzweig said in a statement that the deal allows Pitney to streamline its operations. Pitney said the company’s SendTech and Presort businesses will continue to operate normally.
As part of the e-commerce bankruptcy, the company said Pitney would lend the unit $45 million to pay for the bankruptcy case.
The case is DRF Logistics LLC, 24-90447, U.S. Bankruptcy Court, Southern District of Texas (Houston).
–With assistance from Janine Phakditam and Jonathan Randles.
(Adds agreement with Oaktree bondholder to support liquidation case in first and second paragraphs.)
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