ONEIDA, N.Y. (AFX) - Oneida Ltd., once the world's largest maker of stainless steel flatware, has signed a letter of intent to be acquired by two of its shareholders in a plan to bring the company out of a recently declared bankruptcy.
Hedge funds D.E. Shaw Laminar Portfolios LLC and Xerion Capital Partners LLC will pay at least $222.5 million, or enough to pay the 126-year-old company's secured bank claims. They also will assume all other general unsecured claims, according to Oneida Ltd.
'These firms have had an opportunity to see our operations firsthand as shareholders, and we are pleased that they support Oneida's plan of reorganization,' said Oneida Ltd. Chairman Christopher Smith. 'Importantly, their investment would bring stability and a long-term perspective to Oneida's shareholder base.'
The company's other shareholders must approve the sale, which would give Laminar and Xerion 100 percent of the company. Bankruptcy court also must confirm the company's reorganization plan.
Oneida Ltd. did not say how much shareholders would get from the sale. Some shareholders have said they would be left with nothing under the company's plan for emerging from bankruptcy.
The company filed a plan in March to reorganize under Chapter 11 bankruptcy protection. The plan calls for the company to shed about $100 million in debt. Oneida Ltd. would return to the plan if the proposed acquisition falls through, the company said.
The March filing came a year after the flatware company closed its factories to concentrate on distributing and marketing imported flatware. Oneida Ltd. employed more than 5,500 people worldwide and had annual sales of $500 million at its peak in the 1990s, but it lost more than $157 million between January 2003 and October 2005.
The company listed assets of $305 million and debts of $332 million in its filing.
Oneida Ltd. has 936 employees, including about 430 in central New York.
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