Some of the huge number of Linens 'n Things' vendors have already shut down its supply channels due to nonpayment, and the critical vendor motion would allow it to resume those payments by lifting the stay in a bankruptcy, sources said.
While the nation's second-largest household goods retailer also has a $15 million payment due Tuesday with GE Capital, Black might have been able to revamp that payment schedule if it didn't face such a large number of vendor-creditors that feed its 500 outlets in 47 states, insiders note.
Time is thus running out for Black and Apollo, insiders reason, pointing to the fact that Linens 'n Things' senior notes are trading as low as 40 cents on the dollar. - Terry Brennan
Bankruptcy insiders are eagerly awaiting the expected Chapter 11 filing by Tuesday of Apollo Management LLP's overleveraged Linens 'n Things Inc. Insiders say that Leon Black's Apollo buyout firm has little choice but to seek bankruptcy for the retailer so it can resume payments under a critical vendor motion under the U.S. Bankruptcy Code.
