Hines Horticulture has secured $62 million debtor-in-possession financing, which the commercial grower will use to continue operations as it seeks to sell its assets. The loans, approved by the U.S. Bankruptcy Court for the District of Delaware in Wilmington, come from three pre-petition lenders: Bank of America NA, PNC Bank NA and GMAC Commercial Finance.
Hines Horticulture filed for Chapter 11 on Aug. 20, citing a rise in production costs, pricing pressure from large customers and weather-related factors. The Irvine, Calif.-based company is the industry’s largest producer of ornamental shrubs and container-grown plants in the country, selling to more than 6,670 retail outlets. Its customers include Home Depot, Walmart and many independent garden centers.
Black Diamond Capital Management, which is Hines' largest unsecured creditor and the holder of a majority of its $175 million in senior subordinated notes, has offered $58 million in cash for the company, according to court papers. Hines pursued several possible restructuring alternatives in the months before its bankruptcy filing, including a sale of all or pieces of the business, a new debt or equity infusion or a balance sheet restructuring.
Hines' products are mostly sold under the "Hines Nurseries" trade name. The debtor operates seven commercial nurseries across the country where plants are grown for sale to retailers and other businesses.