Malden Mills emerged from Chapter 11 bankruptcy protection on Friday and expects to finish the legal proceedings early in the week. A federal bankruptcy judge handed down the decision after months of delays stemming from legal maneuvering by creditors.
As previously reported in SEW_0340, Malden was ready to ink a deal with WinnCompanies, which could give Feuerstein control of the company. Under the restructuring plan, the former CEO now holds just 5% of Maldens stock but has the right to acquire the remainder for a price that increases over time.
GE Corporate Financial Services, the largest shareholder with 15% of the company, has indicated it would still accept a $92 million bid, even though that early set price was supposed to have risen to about $124 million under the reorganization terms.
Malden is now under the control of a new board of directors consisting of one board member appointed by Feuerstein, while creditors have appointed four and two appointed by the company. The board will reportedly have the right to accept or reject any plan by Feuerstein to regain control of the company.
Feuerstein is the chairperson and non-executive president, but he will not retain his title of CEO. Feuerstein represents the third generation of the founding family managing the company.