(Bloomberg) -- City Brewing Co., which makes alcoholic drinks such as White Claw and Pabst Blue Ribbon, is seeking a new loan to boost cash while it explores a potential restructuring that could include a bankruptcy filing, according to people with knowledge of the matter.
The La Crosse, Wisconsin-based brewer is in talks with some of its lenders for a roughly $50 million loan that would shore up the company’s cash reserves as it struggles with lower demand, said the people, who asked not to identified discussing a private matter. Negotiations are ongoing and no final decision has been made, the people added.
The talks come less than a year after City Brewing inked a debt restructuring that allowed it to borrow $115 million by shuffling assets into a new legal entity and borrowing against that collateral, Bloomberg previously reported. That deal also revamped the creditor hierarchy and called for below-par debt exchanges.
City Brewing, whose investors include Charlesbank Capital Partners and Oaktree Capital Management, and its lenders have also re-engaged advisers that worked on the April deal, the people said. The company is working with Evercore Inc. and Sullivan & Cromwell, while the group of negotiating lenders retained Perella Weinberg Partners and Gibson Dunn & Crutcher for advice.
Representatives for Charlesbank, Oaktree and Perella declined to comment. City Brewing, Evercore, Sullivan and Gibson did not respond to requests for comment.
Pabst, Old Milwaukee, Colt 45 and others had been working to transition their production to City Brewing by the end of this year, but have faced operational difficulties related to the transfer, Moody’s Ratings said in an October note.
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