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Briggs & Stratton files for Chapter 11 bankruptcy

21 July 2020

Briggs & Stratton Corporation announced it has filed for Chapter 11 bankruptcy protection to address its debt obligations and facilitate the potential sale of the company.

“The challenges we have faced during the COVID-19 pandemic have made reorganization the difficult but necessary and appropriate path forward to secure our business,” said Todd Teske, the company’s CEO.

Briggs & Stratton said it has reached an initial agreement with KPS Capital Partners, which will acquire essentially all of the company’s assets and assume certain customer, employee and vendor liabilities.

Briggs & Stratton has secured $677.5 million in debtor-in-possession (DIP) financing, with $265 million committed by KPS and the remaining $412.5 from the company’s existing lender banks. Following court approval, the DIP facility will enable the company to continue normal operations and to meet its financial obligations during the Chapter 11 process.

In its last two fiscal years, Briggs & Stratton lost $54.1 million (2019) and $11.3 million (2018). In its most recent third quarter that ended March 29, Briggs & Stratton reported an 18% drop in sales from the previous year and a net loss of $145 million, or $3.47 a share, compared with net income of $8 million, or 19 cents a share, for Q3 2019. The net loss included $134 million in non-cash charges.

After the announcement, Briggs & Stratton shares (BGG) fell 27% premarket, and were down 88% in the year to date. BGG stock isn’t trading as of yesterday (July 20) afternoon.

The Milwaukee-based Briggs & Stratton is a Fortune 1000 manufacturer of small utility engines such as those used in lawn and garden equipment. The company manufactures around 10 million engines a year and employs over 5,000 people.

Source: Briggs & Stratton | Diesel Progress