Ames Department Stores Inc. filed an amended reorganization plan in bankruptcy court yesterday.
The amended plan "is the result of months of negotiations between Ames and its creditors' groups." David Reno, a spokesman for the company, said.
The new plan is backed by three of Ames creditors' groups, while the original plan was supported only by its Citibank lending group. Though the amended plan envisions a December emergence from Chapter 11 bankruptcy protection, Mr. Reno said he could not speculate on how the plan win proceed through the court.
The amended version and a related disclosure statement were filed in U.S. Bankruptcy Court for the Southern District of New York, the company said in a release.
Also yesterday. Ames said it has agreed with Citibank on the "principal terms, conditions. and covenants" of a two-year, $210 million post-emergence loan that the bank will provide if the court confirms the reorganization plan.
The plan calls for changes in proposed distributions to creditor's as contained in the original plan, which was filed Jan. 13.
It also calls for $325 million of cash to be paid out over about four years; issuance of $35 minion of new secured notes; distribution of litigation trust units and anticipated proceeds from legal action against Wertheim Schroder & Co.; and distribution of all the new priority and common stock of a reorganized Ames to creditors to settle about $1.6 billion against the company.
The $1.6 billion figure was the estimated total when Ames filed for bankruptcy on April 25, 1990. Asked to describe the Wertheim litigation, Mr. Reno said he could not comment on litigation.,
Like the original plan, the amended one anticipates closing some stores to get cash to distribute to creditors.
The amended plan calls for a combination of new debt and equity to be issued. Upon the plan's con- summation, Ames would come out with about $42 million of reinstated debt and tax debts on its books.
Added to that would be about $58 million of new debt and roughly $175 million of new equity upon the new plan's consummation.
In addition, the new plan divides most pre-petition creditors into five groups.
* The pre-petition bank lending group will get $195 million in cash, $35 million secured notes, and 60% of the reorganized company's voting stock.
* The parent's general unsecured creditors will receive $53 million in cash, 50% of the litigation trust units, 50 of the Wertheim claim proceeds, and 30% of the voting stock.
* The subsidiaries' unsecured creditors will receive $54 million in cash and 2.5% of the voting stock.
* Subordinated debtholders will get 3.5% of the voting stock, warrants to buy up to 1 0% of new common stock, 50% of the litigation trust units, and 25% of Wertheim claim proceeds of more than $20 million.
* TJX Companies Inc. will receive $23 million in cash and 4% or the voting stock.
The voting stock will be split into convertible priority stock, which Ames will issue to the pre-petition bank group, and common stock, which the company will distribute to all other creditors.
Also, the general unsecured creditors, the subsidiaries' unsecured creditors, TJX, and the subordinated debtholders will have the right to excess cash-flow payments if Ames exceeds its business plan for fiscal years 1993 to 1997.
In addition to Citibank, the other two groups that back the plan are the parent's unsecured creditors and the bondholders, Mr. Reno said. The amended plan needs bankruptcy approval to become effective.
Now issues
In secondary trading yesterday, high-grades finished "about three basis points" wider than Wednesday's close, one trader said. High-yield bonds ended quiet and unchanged.
Federal National Mortgage Association issued $300 million of 6.37% medium-term notes due 1999 at par. Noncallable for three years, the notes were priced to yield 32 basis points over comparable Treasuries. Goldman, Sachs & Co. sole managed the offering.
Federal Home Loan Mortgage Corp. issued $150 million of 5.720% notes due 1997 at par. Noncallable for a year, the notes were priced to yield 23 basis points over comparable Treasuries. Merrill Lynch & Co. managed the offering.
Standard & Poor's Corp. has placed the ratings of some News Corp. Ltd.-related entities on Creditwatch for a possible upgrade, the agency said yesterday in a release.
The ratings are: News America Holdings Inc.'s BB-minus senior debt and B subordinated debt; and Fox Television Stations Inc./metro-media's and Twentieth Century Fox Film Corp.'s B subordinated debt. The action affects about $840 million of debt, including $745 million at News America Holdings, $63 million at Twentieth Century Fox. and $30 million at Fox Television Stations, the release says.
"The action is based on the company's results for its fiscal year ended June 1992, S&P's expectation of continued earnings momentum. and the potential for further debt restructuring," Standard & Poor's said.
Moody's Investors Service has placed Chiquita Brands International Inc.'s Ba1 senior debt and Ba3 subordinated debt ratings under review for a possible downgrade, according to an agency release.
"The review was prompted by concern about the ability of Chiquita to turn around its banana business, which generates the bulk of the company's profitability," the Moody's release says.
"The review will focus on the outlook for improvement in banana prices, particularly in Europe," Moody's said. "We will also examine the change in capital structure and debt-protection measurements following the company's proposed exchange of new preferred stock for up to 5 million of its shares of outstanding common stock, and the impact of Chiquita's ambitious capital spending program."
