💥New Chapter 11 Bankruptcy Filing - QVC Group Inc.💥
Famous retailer reels from dependence upon linear TV, seeks to cut debt to pursue new distribution options.
The demise of the QVC and HSN brands has been greatly exaggerated!
At least that’s according to Kirkland & Ellis LLP’s Joshua Sussberg, serving as lead counsel to Pennsylvania-based QVC Group Inc. (a/k/a Qurate Retail Inc.) and 73 subsidiaries including QVC Inc. and Cornerstone Brands Inc. (“Cornerstone,” collectively with QVC Inc. and the other subsidiaries, the “company”),* which, on April 16, 2026, filed chapter 11 bankruptcy cases in the Southern District of Texas (Judge Perez) with a plan — small “p” for path (forward) and large “P” for plan of reorganization — to deleverage the company’s balance sheet by several billions of dollars.
That’s right: billions of dollars.
QVC and HSN, as brands, may not be dead — CFO Bill Wafford,** in a declaration that delays the usual preface of background/qualifications and dives right into the state of things, was decidedly clear about that.*** But linear television’s ability to drive enough revenue to service the company’s billions of debt certainly is. That makes this a story of both disruption and evolution. But not death. At least not yet.
Indeed, the company’s evolution is already under way. Over to you Mr. Wafford:
“…QVC Group launched the first ever 24/7 livestream programming on TikTok in April 2025, quickly becoming a top seller on TikTok Shop in the United States, acquiring over 1 million new customers on TikTok in 2025 alone. This business is expected to double in 2026.”
Contemporaneously,
“QVC Group streaming services have approximately 1.3 million monthly average users, and television broadcast continues to have an engaged customer base, with approximately 91% of sales shipped worldwide coming from repeat customers.”
Which is to say that the company believes it is well-positioned to capitalize on new technologies; it has “…decades of experience with content creation and production expertise; deep vendor relationships; a mature distribution network; and brand recognition….” Already, the company has omni-channel infrastructure and reaches 88mm homes via five television channels, and reaches millions of other people through (i) the QVC.com and HSN.com web sites, (ii) virtual multichannel video programming distributors (including Hulu + Live TV, DirecTV Stream and YouTube TV), (iii) streaming video, and (iv) other digital platforms like Facebook Live, Apple TV, and Amazon Fire.
It also has a complex corporate structure**** …
… and a massive capital structure👇:
And servicing that cap stack is, the company says, preventing the company from leaning into its evolution and investing in its survival the future.*****
So cue more the liability management? Not so fast. It seems we’re seeing the new Kirkland & Ellis LLP playbook — $80mm “guaranteed” for three years notwithstanding — geared towards advising clients to just do what needs to be done and stop f*cking around. Per Mr. Wafford, “QVC Group’s debt burden—premised on now-declining cash flows from linear TV—has impaired its ability to invest at the level necessary to fully transition to the new digital and live social shopping age. And while various parties were interested in several different “liability management” exercises, QVC Group recognized—in the face of linear TV decline—the time had come to address its U.S. balance sheet.” Man that’s dripping with subtext, 🔥.****** So after eight months of planning and negotiating, the company is ready to put itself through the in-court part of all of this — and emerge in less than two months! Ambitious!!
So what does the Plan involve? We’re not going to spend too much time on this but here are the high points of this restructuring:
📍The Plan basically folds in restructurings at four major levels so as to take care of the various issuances that make up the capital structure, including the preferred and common equity — all of which sit at various places (see corp chart again 👆);
📍The filing does not envision an operational restructuring given that the company’s management team has been effectuating its business plan with what it says are encouraging results;
📍As such, general unsecured claims will ride-through unimpaired. Mr. Wafford dubs this a “classic, balance sheet restructuring” which we’d be remiss to point out just so happens to avoid a showdown with any official committee of unsecured creditors which would obviously prolong this process.
📍The company has support from (i) bank lenders, including large commercial banks like JPMorgan Chase ($JPM) and purchasers of senior debt, e.g., SilverPoint Capital and Strategic Value Partners, (ii), an ad hoc group of the QVC Inc. notes (which also happens to include holders of the RCF and LINTA notes, and is comprised of the likes of Oaktree Capital Management and GoldenTree Asset Management LP, among others) and (iii) holders of the LINTA exchangeable notes, which includes, among others, Anchorage Capital Management and Brigade Capital Management.
📍The restructuring eliminates billions of debt so that the company can continue its evolution into the future. Among other things RCF claimants and QVC Inc. noteholders will get cash, takeback paper and 100% of reorganized QVC Inc. shares (subject to dilution from a management incentive plan). Cornerstone will also emerge as a reorganized going concern (and as a structural subsidiary to reorganized QVC Inc.). The parties envision $1.275b of 10% takeback term loans******* and notes (six year maturity) plus a new exit ABL of up to $750mm. For their part, LINTA noteholders will get cash and other goodies.
📍Preferred and common are looking at a 🍩. Per Mr. Sussberg:
“Preferred stock which is about 1.2 billion and common stock will not see a recovery in these cases. And we sympathize and empathize with those parties and we understand the investment decisions that various parties make, but the absolute priority rule says what it says, 5 billion dollars is being exchanged into new debt and equity and this company desperately needs to deleverage. If Mr. Brody [of Cleary Gottlieb Steen & Hamilton LLP, legal counsel to the pref] wants to have a conversation on a theoretical basis about valuation, I'm all ears and he knows where to find me.”
Mr. Sussberg was right to foreshadow that Mr. Brody would have beef but his beef wasn’t an issue for the “first day”.********
📍To carry out the restructuring, the debtors intend to tap a $300mm DIP letter of credit (2.5% interest rate, 0.5% commitment fee, 0.125% fronting fee, 0.75% closing fee).
📍Reorganized QVC Inc. will be a public company!
We look forward to seeing whether this fast-moving train remains on track.
The debtors are represented by the aforementioned Kirkland & Ellis LLP (Joshua Sussberg, Aparna Yenamandra, Chad Husnick, Gabriela Zamfir Hensley, Alan McCormick, Gabrielle Abbe, Michael Esser, Mark McKane) with Gray Reed (Jason Brookner, Lydia Webb, Emily Shanks) as local counsel, AlixPartners LLP (Jason Keyes) as financial advisor, Evercore Group LLC (EVR) as investment banker, and Joele Franke (Michael Freitag, Viveca Tress, Richard Goldman, Wilkinson Brimmere Katcher) as communications advisor. JPMorgan Chase Bank NA ($JPM) as RCF Agent is represented by Simpson Thacher & Bartlett LLP (Nicholas Baker, Moshe Fink, Rachael Foust, Zachary Weiner) as legal counsel and Lazard Frères & Co. LLC ($LAZ) as financial advisor. The QVC Noteholder Group is represented by Davis Polk & Wardwell LLP (Damian Schaible, Angela Libby, Aryeh Ethan Falk, Helen Zhang) and Porter Hedges LLP (John Higgins, M. Shane Johnson, James Keefe, Joanna Caytas) as legal counsel and PJT Partners LP ($PJT) as financial advisor. The LINTA Ad Hoc Group is represented by Akin Gump Strauss Hauer & Feld LLP (Marty Brimmage, Brad Kahn) as legal counsel and Centerview Partners LLC as financial advisor. And as previously noted, some pref equityholders are represented by Cleary Gottlieb Steen & Hamilton LLP (Josh Brody, David Botter).
*We don’t delve into the company’s history here but suffice it to say, it’s quite interesting and the first day papers are worth a read. The origin and growth story is 🤯.
**Mr. Wafford was also CFO of J.C. Penney during its restructuring. You have to hand it to Kirkland (and particularly Mr. Sussberg): people say company-side work doesn’t lend itself to repeat business but there are industries — retail, for one — that recycle people like crazy and Kirkland has managed to leverage previous mandates into new mandates like no other.
***This was like Star Wars: Rogue One skipping the famous and traditional opening scroll. This is a new day: let’s get right to it.
****We’re not going to get into the complexity of the borrowers and guarantors of the various issuances nor the governance, all of which is complex and not necessary to delve into at this juncture. Suffice it to say that there were all kinds of prepetition machinations to make sure that separateness was honored, the potential for intercompany claims recognized, and governance instituted at a number of boxes:
*****For fiscal year ‘25, the company had $5.9b of revenue across its largest “QxH” segment (which encompasses QVC and HSN), $2.4b of revenue from its international business, and another 10% of revenue (unquantified) from Cornerstone.
******To be clear, there were multiple out of court balance sheet transactions over the last, say, five or six years before the company ultimately ended up where it is today. As for the point about more liability management, Mr. Sussberg was far more direct in his opening presentation at the first day hearing, stating:
“And I will give credit to the management team who held steadfast in the fact that this company needed to deleverage in order to deal with the trends and the changes and the way in which people shop and interact. We often time hear stories about liability management … it's not new. We've been doing restructuring out of court for years and years and years, but when we speak to a company and we speak to a board, we talk about, we ask the question, 'To what end?' And this management team answered that question and said we could kick the can and we could extend maturities, but we need to deleverage this balance sheet.”
*******This could end up being $100mm more depending upon how the exit ABL shakes out. The exit ABL is still in the process of being shopped.
********Mr. Brody did, however, come in hot. His issue arises out of the fact that the pref is at the QVC Group Inc. holdco level and the holdco has assets and no debt. He stated:
“I of course hate to be the only person who's standing up in front of Your Honor today who's not singing Kumbaya. But as you might imagine we have a little bit of a different perspective on the debtors' proposed plan than as Mr. Sussberg laid out. Now of course I want to note, I think a lot of what the debtors and their professionals and the various creditor groups have accomplished is from my perspective actually fantastic. I think saving this company is hugely important, saving all those jobs is a fantastic idea. I don't have an issue with most of what the debtors and the various creditor groups are trying to accomplish. The problem that I do have Your Honor is that from my clients' perspective at a high level it seems that all the various parties got together and decided that they were going to take the assets sitting at the holding company which as has been noted multiple times has zero debt and they were going to use those assets to help fund recoveries at the various subsidiaries. Now unlike what Mr. Sussberg pointed out, this has nothing to do with the absolute priority rule, it has nothing to do with valuation, it has to do with the simplicity of corporate separateness. The HoldCo has no obligations, it's not on the hook for any of the subsidiary debt. And the fact that it has assets which are really only there to be distributed at this point to the preferred holders and it's being used to actually fund recoveries at the various subsidiaries. And the basis for doing this is this quote-unquote intercompany settlement which candidly is given very short shrift in the disclosure statement that I've seen so far. And it's just oh so somehow there's a new 400 million dollar intercompany claim which has never been previously disclosed in any of the debtors' SEC filings. And this is a claim that somehow is now created that is going to suck all of the value out of the HoldCo and send it down into the subsidiaries to fund recoveries. And as I think Your Honor if I am reading the papers correctly this is really I think the only intercompany claim that's going to be getting a recovery and so absent this settlement that they've proposed there would be actually meaningful recovery to the preferred. So from our perspective Your Honor and I'm not asking for any relief today obviously there's more to come, but I thought it was important that from our perspective Your Honor and the court should appreciate we think that the equity are not being adequately represented and that there is a need for an official equity committee in this case. Something we will obviously take up in the first instance with the US Trustee's office. But I didn't want the hearing to go by and Your Honor assume all these wonderful things many of which are wonderful but there's a problem I think our clients' pockets are being picked and that's something we're going to have to address.”
We’d add that a holder of the pref also stood up at the first day hearing and spoke passionately about how he believed holders of the pref weren’t getting boned. 1,000+ aura from that guy.
Company Professionals:
Legal: Kirkland & Ellis LLP (Joshua Sussberg, Aparna Yenamandra, Chad Husnick, Gabriela Zamfir Hensley, Alan McCormick, Gabrielle Abbe, Michael Esser, Mark McKane) and Gray Reed (Jason Brookner, Lydia Webb, Emily Shanks)
Legal to QVC Group Inc. Kobre & Kim LLP
Legal to QRI Cornerstone Inc: Seward & Kissel LLP
Legal to Liberty Interactive LLC + Qurate Retail Group Inc.: Milbank LLP (Dennis Dunne, Elizabeth Downing, Andrew Leblanc, Erin Dexter, Julie Wolf)
Board of Directors: David Rawlinson II, Carol Flaton, Fiona Dias, Gregory Maffei, M. Ian Gilchrist, Richard Barton, Roger Meltzer, Evan Malone, Eve DelSoldo, Matthew Owen, Aidan O’Meara, Stacie Tedesco, Eugene Davis, Thomas Walper, Jill Frizzley, Paul Keglevic, Jonathan Foster, Michael Zendan II, David Apostolico, Michael Budicak, Michael Smith, Robert Smith, Steve Chapracki, Charles Durante, Bill Wafford, Karen Mooney, Thomas Bazzone, Kenneth Walker, Constance Hallquist, Adam Cavanaugh, Brian Beitler, Stacy Bowe
Legal to Jill Frizzley and Paul Keglevic as IDs of QVC Inc.: Katten Muchin Rosenman LLP (Andrew Pecoraro)
Financial Advisor: AlixPartners LLP (Jason Keyes)
Investment Banker: Evercore Group LLC
Communications Advisor: Joele Franke (Michael Freitag, Viveca Tress, Richard Goldman, Wilkinson Brimmere Katcher)
Claims Agent: Kroll (Click here for free docket access)
Other Parties in Interest:
RCF Agent: JPMorgan Chase Bank NA
Legal: Simpson Thacher & Bartlett LLP (Nicholas Baker, Moshe Fink, Rachael Foust, Zachary Weiner)
Financial Advisor: Lazard Frères & Co. LLC
QVC Notes Trustee: U.S. Bank NA
Legal: Pryor Cashman LLP
QVC Noteholder Group
Legal: Davis Polk & Wardwell LLP (Damian Schaible, Angela Libby, Aryeh Ethan Falk, Helen Zhang) and Porter Hedges LLP (John Higgins, M. Shane Johnson, James Keefe, Joanna Caytas)
Financial Advisor: PJT Partners LP
LINTA Notes Trustee: The Bank of New York Mellon Trust Company NA
Legal: Reed Smith LLP
The LINTA Ad Hoc Group
Legal: Akin Gump Strauss Hauer & Feld LLP (Marty Brimmage, Brad Kahn)
Financial Advisor: Centerview Partners LLC
Preferred equityholders
Legal: Cleary Gottlieb Steen & Hamilton LLP (Josh Brody, David Botter)
Large equityholders (real slick redaction, guys):
