We are advising Big Lots in connection with the restructuring

Davis Polk is advising Big Lots, Inc. and its affiliates (collectively, “Big Lots”) in connection with their restructuring under chapter 11 of the United States Bankruptcy Code. Big Lots intends to use the restructuring process to support its ongoing business operations and address its real estate lease portfolio while it works towards an orderly and efficient sale of the business.

On September 9, 2024, Big Lots filed voluntary chapter 11 petitions in the United States Bankruptcy Court for the District of Delaware. At a hearing on September 10, 2024, Judge J. Kate Stickles approved Big Lots’ debtor-in-possession financing on an interim basis, which authorized Big Lots to access and use financing commitments provided by its existing lenders under (i) a $550 million debtor-in-possession asset-based revolving credit facility and (ii) a $157.5 million debtor-in-possession term loan credit facility, up to $100 million of which term loan commitments are immediately available on an interim basis. In addition, the Court granted Big Lots all of its requested relief in its first-day motions, including the authority to pay a significant amount of prepetition critical vendor obligations, pay employee wages and benefits in the ordinary course, continue store closing sales, and establish procedures for the sale of leases.

Prior to filing for chapter 11, on September 8, 2024, Big Lots entered into an asset purchase agreement for the sale or all or substantially all of its assets and business operations with affiliates of Nexus Capital Management LP, which has agreed to act as the stalking horse bidder through a Court-supervised marketing process. Big Lots intends to continue this marketing process through chapter 11 and seek the highest or otherwise best bid in a going-concern sale.

Big Lots is a one-stop shop home discount retailer. Big Lots’ mission is to help customers “Live Big and Save Lots” by offering bargains on everything for their homes, including furniture, décor, pantry essentials, kitchenware, groceries, and pet supplies. Headquartered in Columbus, Ohio, Big Lots operates more than 1,300 stores across 48 states in the United States, as well as an ecommerce store with expanded fulfillment and delivery capabilities.

The Davis Polk restructuring team includes partners Brian M. Resnick and Adam L. Shpeen, counsel Stephen D. Piraino and Jonah A. Peppiatt and associates Ethan Stern, Vincent Cahill, Kevin L. Winiarski and Jacob Goldberger. The finance team includes partner Nick Caro and counsel Jason Palios. The corporate team includes partners H. Oliver Smith and Brian Wolfe and counsel Heather Weigel. The litigation team includes partner James I. McClammy. Partner Corey M. Goodman and counsel Tracy L. Matlock are providing tax advice. Partner Adam Kaminsky is providing executive compensation advice. Members of the Davis Polk team are based in the New York and Washington DC offices.

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