Forever 21’s US Operator Wins Court Approval to Liquidate

The former operator of Forever 21’s US stores won court approval on a plan to partially repay vendors and other creditors that stand to incur big losses in the retailer’s bankruptcy.

The repayment plan includes a settlement with lenders and former Forever 21 parent Sparc Group that’s designed to boost recoveries for unsecured creditors that stood to get pennies on the dollar. Sparc agreed to fully waive a $323 million claim that would have diluted any amounts received by unsecured creditors. They will get 70% of any net proceeds that F21 OpCo obtains during liquidation.

The deal approved ...