GNC reports sale of substantially of its assets to Harbin Pharmaceutical

October 07, 2020

Torys represented GNC as Canadian counsel in its Chapter 11 sale and CCAA recognition proceedings with a team that included Scott Bomhof, Adam Slavens, Emma Sako and Mike Noel (corporate/restructuring/M&A), Jeremy Opolsky and Leora Jackson (CCAA recognition proceedings), Tom Zverina and Nadine Rockman-Katz (lending), Mitch Frazer (employment), Richard Johnson and Patrick Reynaud (tax).

On October 7, 2020, GNC Holding Inc. (“GNC”) reported the closing of its previously disclosed agreement with Harbin Pharmaceutical Group Holding Co., Ltd. (“Harbin”) in which, pursuant to a stalking horse agreement, Harbin agreed to acquire substantially all of the assets of GNC and certain of its subsidiaries.

The closing was consummated through a series of transactions under a court-supervised sale process through which GNC and certain of its subsidiaries

  • transferred substantially all of their assets (other than their Canadian assets) to GNC Holdings, LLC, a Delaware limited liability company formed as a wholly owned subsidiary of GNC (“New GNC”), and
  • transferred substantially all of their Canadian assets to GNC Canada Holdings ULC, a Nova Scotia unlimited liability company formed as a wholly owned subsidiary of New GNC. At closing, Harbin, indirectly through ZT Biopharmaceutical LLC, a wholly owned subsidiary of Harbin, purchased 100% of the issued and outstanding equity interests in New GNC.

Proceeds from the closing will be used to, among other things, pay off

  • all amounts owing under the US$100 million debtor-in-possession term loan credit agreement
  • the US$100 million of roll-up term loans under the amended and restated term loan agreement, dated as of February 28, 2018, and
  • all amounts owing under the US$275 million debtor-in-possession amended and restated ABL credit agreement.

GNC filed for bankruptcy protection under Chapter 11 of the U.S. Bankruptcy Code on June 23, 2020, in addition to seeking recognition of the proceedings in Canada on June 24, 2020 under the Companies' Creditors Arrangement Act.

Further information can be found on GNC’s website and on the website of the CCAA Information Officer.

GNC Holdings is a leading global health and wellness brand that provides high quality science-based products and solutions.

Harbin Pharmaceutical develops and manufactures a variety of medicines, preparations, Chinese traditional medicines, healthcare products, and biopharmaceuticals.

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