2 Bowling Companies Propose Business Merger To Bankruptcy Court
On behalf of The Law Office of Lynnette Ariathurai, A Professional Corporation posted in Mergers & Acquisitions on Thursday, June 6, 2013.
Sometimes, two heads are better than one, as the saying goes. In the world of business, the same idea also applies. Sometimes, two companies are better than one. Two bowling companies seem to have had this idea in mind when they decided to move forward with a business merger to combine the two companies into one entity, which would include at least one location in California.
AMF Bowling Worldwide Inc. has just submitted a proposal to a bankruptcy court for plans to emerge from a Chapter 11 bankruptcy by merging with another operator of bowling venues. The proposal would combine the company with Bowlmor, which currently runs six upscale bowling venues. According to the proposed plans, Bowlmor's current CEO would become the head of the newly formed entity, which would be known as Bowlmor AMF.
The new business entity would employ 7,500 people and would operate 276 bowling venues with an estimated yearly revenue of $450 million. Second-lien lenders for AMF would obtain a 77.53 percent stake in the newly-formed Bowlmor AMF. The proposal would also pay first-lien creditors all debts owed in full. Several creditors have also agreed to provide the new business entity with significant loans.
As is illustrated in this particular case, a business merger can have various aspects which must be decided upon when attempting to formulate a new business structure. It is also important to understand the laws regulating the particular industry in order to ensure compliance. This will help to avoid future legal problems, which could include lawsuits and fines in California or in any other state.
Source: Richmond Times Dispatch, "AMF Bowling plans merger with New York-based company," John Reid Blackwell, May 22, 2013