August 1, 2003
Update on Ross Purchase of Burlington
On Friday afternoon, a bankruptcy judge signed off on a $620 million bid by W.L. Ross Inc. LLC to buy Burlington Industries after the parties agreed to an amended deal structure that makes it less likely that a break-up fee will come into play.
Under the terms of the amended agreement, Ross will collect a $6.08 million fee only if Burlington receives and accepts a higher bid from another interested party, and that deal closes.
Late on Thursday, U.S. Bankruptcy Court Judge Randal Newsome of Wilmington, Del., threw out a $6.08 million break-up fee that was part of the bid by Ross to buy bankrupt Burlington Industries, sending the parties back to the negotiating table to find a compromise that would receive court approval.
The deal still needs regulatory approval on antitrust grounds and Burlington?s plan of reorganization will also need a green light from creditors. The company has said it expects the sale to Ross, as well as its emergence from Chapter 11 bankruptcy, to occur by October.
Staff contact: Rita Kourlis Samuelson, ext. 29