Tupperware Strikes Deal to Exit Bankruptcy

Tupperware Brands Corporation (NYSE:TUP) has received approval from a U.S. bankruptcy judge to sell its assets to creditors. This move will allow the company to emerge from bankruptcy while preserving most of its operations. The decision, approved by U.S. Bankruptcy Judge Brendan Shannon in Wilmington, Delaware, comes as a strategic exit for the food storage and kitchen products giant, which has struggled to find a buyer to address its $818 million debt.

The company, known for its food storage containers and kitchenware, was seeking a buyer before filing for bankruptcy, but as explained by Tupperware's attorney Spencer Winters during the court proceedings, it failed to secure a bid that would address its significant debt.

The consortium purchasing the assets is led by Stonehill Capital Management Partners and Alden Global Capital. As detailed in court documents, these investment firms purchased Tupperware's debt at a significant discount earlier in the year. The purchase package includes $23.5 million in cash and over $63 million in debt relief.

The sale encompasses Tupperware's brand and assets in key markets such as the U.S., Canada, Mexico, Brazil, China, Korea, India, and Malaysia. Post-bankruptcy, Tupperware plans to terminate operations in some regions and transition to a "digital-first, technology-focused, and asset-light" business model, as indicated by CEO Laurie Ann Goldman in a statement last week.

The Orlando-based company had previously filed for Chapter 11 protection with the intention of auctioning off its assets. However, creditors initially objected to Tupperware's sale strategy and preferred to purchase the assets directly. This dispute led creditors to cut off Tupperware's cash access early in the bankruptcy process until an agreement was reached.

With the court's approval, Tupperware is now ready to carry out the agreed sale, marking a significant step toward restructuring and stabilizing the company's future operations.