In another attempt to save its financial life, Family Christian Stores asked a bankruptcy judge to let its creditors decide the fate of the beleaguered chain by August 7. Creditors must vote by that date to approve a plan to sell the company to Family Christian Acquisition, a subsidiary of the chain’s parent company which earlier vowed to continue operation of most of the 266 stores in 36 states.
U.S. Bankruptcy Judge John Gregg approved this new plan last Friday after blocking FCS from selling itself to FCS Acquisition last month. Creditors will now vote on whether or not the sale should go through based on the amount and type of debt they are owed by Family Christian Stores. Unsecured creditors, which include many of the nation’s publishers of religious books and products, are owed a total of $40 million. Secured creditors include FC Special Funding, are owed $24 million, and Credit Suisse, owed $34 million.
FC Special Funding is backed by Richard Jackson, an Atlanta businessman who also owns Family Christian Stores and Family Christian Acquisition. Although FC Acquisition was named the “highest and best” bidder in a days-long auction held earlier this year, Judge Gregg denied the sale to FC Acquisition.
Eight separate voting classes must each approve the plan by 51 percent of the votes cast and with 67 percent of the dollars represented, according to a story on MLive.com.
