Leslie's Stock Plunges 15% as Chapter 11 Filing Looms With $750M Debt Swap
LESL sits 24% above its 52-week low of $0.252.
Summary
Leslie's shares are down 14.75% to $0.28 on Friday after the WSJ reported late Thursday that the company is finalizing a Chapter 11 restructuring to hand control to lenders. The plan includes roughly $100M in DIP financing and conversion of about $750M in debt to equity, effectively wiping out existing shareholders. This follows last month's going concern warning and a 10-Q that flagged $786.7M in debt and a 2028 term loan maturity. The company has already closed 80 stores and a distribution center to stem cash burn, but sales declines persisted. The bankruptcy filing is expected as soon as next week in Houston.
At the time of this announcement, LESL was trading at $0.31 on NASDAQ in the Trade & Services sector, with a market capitalization of approximately $2.9M. The 52-week trading range was $0.25 to $12.53. This news item was assessed with negative market sentiment and an importance score of 8 out of 10. Source: Benzinga.