APPLETON, WI (WTAQ) - An Appleton area company that provides school supplies and products to for pre-kindergarten market has filed for Chapter-11 bankruptcy.
School Specialty Incorporated of Greenville said Monday morning it would sell its assets – and the investment firm of Bayside Capital has agreed to be the first bidder.
The firm could go to a higher bidder if a court allows it.
In the meantime, the company expects to keep operating as normal.
Reuters News Service said School Specialty lost money in the last six months, partially because of the seasonal nature of providing equipment and supplies to those pre-kindergarten schools.
Also, Reuters said the firm depended on local-and-state school aids, which have taken a large hit ever since the Great Recession began in earnest in late 2008.
In a bankruptcy filing in Delaware, School Speciality said it had almost $500-million in assets, and close to $400,000 in debts.
Reports said the company’s board has agreed to borrow up to $175-million to keep operating through its bankruptcy process.
An affiliate of Bayside Capital is committing $50-million of debtor-in-possessing financing.
A New York bank is School Specialty’s largest unsecured creditor, with $157-million due.
The firm that makes Crayola crayons is owed just over four-million. School Specialty says it could take up to three months to complete a sale.