MIAMI-Let’s Talk Cellular & Wireless Inc., a speciality cellular and wireless retailer, plans to conduct business as usual after filing for reorganization under Chapter 11 of the U.S. Bankruptcy Code.
The company noted that the filing, which was made in the U.S. Bankruptcy Court for the District of Delaware, will offer Let’s Talk protection to continue operating its 259 outlets while implementing its plan to return to profitability.
Let’s Talk also announced it has received a $15 million debtor-in-possession financing commitment from a syndicate of banks led by Chase Manhattan Bank. The DiP loan will provide the company with working capital to meet immediate and future inventory needs and will be used to fulfill its business obligations, including employee wages and new vendor invoices.
“New inventory made available by our new DiP facility should be arriving in stores immediately,” said Brett Beveridge, founder and chief executive officer of Let’s Talk.
“We anticipate moving forward quickly through a reorganization process that will maximize value for the benefit of all creditors and stockholders.”
In its bankruptcy petition, Let’s Talk reported it had exhausted its working capital and accumulated total debt of approximately $52 million. The company reported consolidated net sales for the nine months ending April 30 of $88.6 million.
“Over the last year, the company focused on integrating acquisitions and building infrastructure as a platform for the future,” Beveridge explained. “Now, we must focus on reducing costs, driving sales and returning to the energetic type of approach that made us so successful.”
Beveridge acknowledged that even though the company would look for ways to reduce costs and increase sales, he noted that it would not abandon the high traffic malls where the company’s logo is well known, or cut down on the 500 different wireless products and accessories each store typically carries.
“We will use this period to catch our financial breath, optimize our information systems and re-focus management; in short-return to the basics that made us so successful,” Beveridge said. “Long term, we intend to identify an acceptable strategic or financial partner that will allow us to repay our creditors and emerge as a dominant force in the wireless product market.”
