AMF Bowling requests approval of bid procedures, exit loan commitment

By Caroline Salls

Pittsburgh, Nov. 20 - AMF Bowling Worldwide, Inc. requested court approval of the bid procedures for the proposed sale of substantially all of the company's assets, according to a Monday filing with the U.S. Bankruptcy Court for the Eastern District of Virginia.

Bids will be due by 5 p.m. ET on Feb. 25, and the auction will be held on Feb. 28.

Each bid must provide for a total consideration that equals or exceeds the sum of the amount needed to pay first-lien claims in full in cash on the effective date of AMF's plan of reorganization, the amount needed to repay the company's debtor-in-possession financing in cash on the plan effective date, the amount needed to pay all administrative and priority claims through the plan effective date and a $500,000 initial minimum overbid increment.

Overbids at auction must be made in minimum increments of $250,000.

Under the proposed bid procedures, AMF Bowling can seek court approval to enter into a stalking horse bid any time before the bid deadline.

Exit financing

In addition, AMF Bowling requested court approval to enter into a $154.5 million exit financing commitment letter.

The initial exit lenders would be Midtown Acquisitions, LP, Credit Suisse Loan Funding LLC, Goldman Sachs Palmetto State Credit Fund, LP and Liberty Harbor Master Fund I, LP.

The exit facility would mature in four years from the closing date.

The facility will generally bear interest at 11%. According to the motion, the facility could bear interest at either Base rate plus 850 basis points with a 250 bps floor or Libor plus 950 bps with a 150 bps floor at the borrower's option

Under the company's restructuring support agreement, some of AMF's first lien lenders would provide the exit financing in the absence of higher and better offers through the sale process or the availability of alternative financing on more favorable terms.

Hearings on the bid procedures motion and exit commitment letter motion are scheduled for Dec. 6.

AMF, based in Richmond, Va., is the world's largest owner and operator of bowling centers. The company filed for bankruptcy on Nov. 13. The Chapter 11 case number is 12-36495.

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