* Bankruptcy judge approves restructuring plan - lawyer
* Lenders to take control of company
* Unsecured creditors see small recovery
NEW YORK, Aug 11 Harry & David Holdings Inc won
tentative court approval for its reorganization plan on
Thursday, clearing the way for the gift basket maker to emerge
from bankruptcy under the control of senior noteholders.
U.S. Bankruptcy Judge Mary Walrath, at a hearing in
Wilmington, Delaware, said she was prepared to approve the
reorganization, according to Brad Erens, a lawyer for Harry &
David. Walrath had not entered an official order on the court
docket by late Thursday.
Harry & David filed for Chapter 11 protection in March,
citing falling sales and competition from "big-box" retailers
such as Wal-Mart Stores Inc (WMT.N).
The Medford, Oregon-based company filed its reorganization
plan in May after winning support from most bondholders and
That plan calls for the exchange of $200 million in senior
debt for equity in a restructured company. Unsecured creditors
would recover about 10 cents on the dollar over a two- to
three-year period, Erens said.
UBS AG (UBS.N) and Ally Financial, which lent Harry & David
$100 million to keep operating while in bankruptcy, will
continue to finance the company upon its emergence, said Jesse
Austin, a lawyer for UBS.
The case is In re Harry & David Holdings Inc, U.S.
Bankruptcy Court, District of Delaware, No. 11-10884.
(Reporting by Nick Brown; Editing by Ted Kerr)