Briefcase

Party City files for Chapter 11

Party City is seeking bankruptcy protection, a final blow for the retailer that struggled to rebound after sales plummeted during the pandemic.

The firm filed for Chapter 11 bankruptcy in the Southern District of Texas on Tuesday, court documents show. It reached a plan with holders of more than 70% of its first-lien secured notes that will see it cut debt and shed leases, according to a statement.

Chapter 11 filings allow a company to keep operating while it works out a plan to repay creditors. The creditor group has agreed to provide $150 million to help the company fund itself in bankruptcy.

The company’s restructuring plan, which is subject to court approval, calls for the secured bondholders to swap their holdings for equity in the reorganized company. Existing stock will be canceled, with no expected recovery for shareholders.

Party City, which operates a store at 13806 E. Indiana Ave. in Spokane Valley, listed assets of $1 billion to $10 billion and liabilities in the same range in its petition. Some subsidiaries including units outside the U.S. and the company’s prized Anagram balloon business were not part of the bankruptcy filing.

Southwest pilots plan strike vote

Southwest Airlines pilots will vote on whether to authorize their union to strike, frustrated by lack of progress in talks that started three years ago and scheduling issues that contributed to 16,700 flight cancellations late last month.

It will be the first time that Southwest aviators have voted on such a move, the Southwest Airlines Pilots Association said in a message to members Wednesday.

The vote, which starts May 1, won’t allow pilots to walk off the job. It’s one in a series of steps required under a federal law governing airline-labor relations that involves the National Mediation Board and eventually could lead to a strike.

All four of the nation’s largest airlines are working to reach new pilot labor agreements after the pandemic stalled negotiations, and the updated contracts are expected to be costly.

From wire reports