Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
School Supply Distributor Seeks Chapter 11 Bankruptcy Protection
Author: Joel R. Glucksman
Date: February 12, 2013
Key Contacts
Back
School Specialty Inc., a distributor of educational supplies to grade schools, has filed for Chapter 11 protection under bankruptcy law.
The Wisconsin-based company sought protection in U.S. Bankruptcy Court in Delaware, and listed $494.5 million in assets and $394.5 million in liabilities. Following the bankruptcy filing, and an announcement that the assets would be auctioned off, company shares fell by roughly 80 percent. Despite the company’s precarious financial position, School Specialty said it has already been authorized to receive up to $175 million in loans from the company’s board to carry it through the bankruptcy process. Bayside Capital Inc. has been appointed as the “stalking horse” bidder for the auction, and has agreed to provide $50 million in debtor-in-possession financing to School Specialty.
In a statement, School Specialty president and CEO Michael Lavelle said the company hopes to emerge from the bankruptcy proceedings within 90 days and will continue operations during the restructuring process.
“We are pleased to have reached these agreements with Bayside, and are confident School Specialty’s business has a bright future,” said Lavelle. “We fully expect to continue normal business operations, providing quality, value-driven education products and excellent customer care. Our customers remain a top priority and we plan to meet all our customer commitments and maintain customer policies and programs.”
Although the company declined to comment on the precise cause of its financial troubles, a Reuters analysis noted that school supply markets are seasonal, which can lead to fluctuations in revenue and earnings. In addition, the schools the company supplies are heavily dependent on state and local funding, which has dried up considerably since the recession. Budget cuts have rendered many schools unable to adopt new curriculum guidelines, and as a result, they have stopped spending money on new instructional materials to meet these guidelines.
- Practices: Bankruptcy & Creditors' Rights, Corporate Transactions & Business, Bankruptcy Litigation
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Fort Monmouth Redevelopment and the Transformation of Monmouth County Real Estate
The Fort Monmouth redevelopment has entered its execution phase, and it is repositioning the broader Monmouth County real estate market. When Netflix and the Fort Monmouth Economic Revitalization Authority closed on the 292-acre Mega Parcel in December 2025, the transaction did more than hand over a deed. It marked the moment Fort Monmouth stopped being […]
Author: Donald M. Pepe
Local Zoning and Land Use Rules Every New Jersey Rental Property Owner Should Understand
Owning a residential rental property in New Jersey involves more than finding tenants and collecting rent. Property owners must comply with a combination of state laws, municipal ordinances, building and housing codes, and zoning and land use regulations. These requirements can affect everything from the number of dwelling units permitted at a property to whether […]
Author: Donald M. Pepe
Real Estate Litigation Explained: Top 5 Disputes and How to Avoid Them
The five most common real estate disputes are breach of contract claims, landlord-tenant conflicts, zoning and land use disagreements, construction claims, and boundary disputes. Understanding why each arises, and taking preventive steps early, can help property owners, tenants, developers, and investors avoid costly litigation. Key Takeaways: Real estate transactions are complex endeavors involving numerous parties […]
Author: Paul Grossman
When a Child Turns 18: The Gap in Your Family’s Estate Plan
Once a child turns 18, parents lose the automatic legal authority to make medical and financial decisions on their behalf, even if the child still lives at home or remains on the family’s insurance. Three documents close that gap: a durable power of attorney, a health care proxy or directive, and a HIPAA authorization. For […]
Author: George McGowan
Business Mediation: An Overview and Practical Tips
Business mediation is a confidential, voluntary process in which a neutral third party helps companies negotiate a resolution to a commercial dispute without going to trial. Because working with a mediator is very different from litigating in the courtroom, it is important to understand how commercial mediation works, when it makes sense for your dispute, […]
Author: Paul Grossman
Top 5 Causes Leading to Construction Defect Litigation
The five most common causes of construction defect litigation are design defects, substandard materials, workmanship defects, code violations, and subsurface defects. Because these flaws can compromise a building’s integrity, functionality, or safety, they frequently lead to disputes involving multiple parties and high financial stakes. Key takeaways: What is Construction Defect Litigation? Construction litigation is complex, […]
Author: Paul Grossman
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.