Multi-Color Corporation Announces Strategic Restructuring

Multi-Color Corporation (“MCC” or the “Company”), a provider of prime label solutions, announced strategic actions to further position the Company for long-term growth and investment to best serve its customers.

MCC has entered into a restructuring support agreement (the “RSA”) with holders of approximately 70% in amount of MCC’s secured first lien debt and its equity sponsor, CD&R, on the terms of a comprehensive financial restructuring. The transactions contemplated by the RSA will significantly deleverage MCC’s balance sheet, reducing its net debt load from approximately $5.9 billion to approximately $2.0 billion. The Company’s annualized cash interest will also be reduced from approximately $475 million to $140 million in 2026, a reduction of over $330 million, with long-term debt maturities extended to 2033 following consummation of the restructuring transactions.

To implement the transactions contemplated by the RSA, MCC has launched a solicitation for votes in support of a prepackaged plan of reorganization (the “Plan”), which is currently supported by holders of approximately 70% in amount of MCC’s secured first lien debt and CD&R. The RSA provides for an $889 million new common and preferred equity investment that will support long-term growth and investment. Upon emergence, MCC will have more than $500 million of liquidity.

“Over the past two years, we have taken decisive actions commercially and operationally, while onboarding top-notch leadership talent, to best position MCC for sustainable, profitable growth,” said Hassan Rmaile, President & Chief Executive Officer of MCC. “Our operational initiatives are showing momentum, and optimizing our capital structure is an essential step to advance our growth strategy. This agreement, which reflects a strong vote of confidence by MCC’s sponsor and lenders, will create a stronger financial foundation, enabling us to enhance the innovative and high-quality label solutions that help brands connect with consumers, enhance product integrity, and drive sustainable impact. We are grateful for CD&R’s and our lenders’ support as well as the ongoing dedication of our employees, customers, and suppliers.”

BUSINESS AS USUAL

The RSA also provides for $250 million of new money debtor-in-possession (“DIP”) financing to capitalize the business throughout the Chapter 11 process. This additional financing, when approved, is expected to allow MCC to continue operating in the ordinary course during the restructuring without impacting trade creditors, customers, employees, vendors, or suppliers, and will allow the Company to honor its commitments to strategic partners.

Upon commencement of the prepackaged Chapter 11 proceedings, MCC will file a series of first day motions that, subject to court approval, will allow the Company to continue to operate in the ordinary course of business while it works to deleverage its capital structure. In addition to seeking approvals related to the DIP financing, MCC will seek authority to allow the Company to continue to maintain wages and benefits without interruption, satisfy employee-related claims, pay vendors in the ordinary course, and perform other critical functions and processes necessary for the Company to continue uninterrupted operations.

ADDITIONAL RESOURCES

Additional information is currently available at MCCForward.com. Upon the Chapter 11 filing, MCC will also provide details on various legal aspects of MCC’s restructuring process, including access to Court documents.

ADVISORS

Kirkland & Ellis LLP and Cole Schotz P.C. are serving as legal counsel, Evercore is serving as investment banker, AlixPartners is serving as financial advisor, Quinn Emanuel Urquhart & Sullivan, LLP is serving as special counsel to the Special Committee of LABL, Inc.’s Board of Directors, and FGS Global is serving as strategic communications advisor to the Company. Debevoise & Plimpton LLP and Latham & Watkins LLP are serving as legal counsel to CD&R and Moelis & Company LLC is serving as financial advisor. Milbank LLP and PJT Partners serve as legal counsel and financial advisor, respectively, to the ad hoc group of secured creditors.

Source: Multi-Color Corp.

The preceding press release was provided by a company unaffiliated with Packaging Impressions. The views expressed within may not directly reflect the thoughts or opinions of the staff of Packaging Impressions.