💥New Chapter 11 Bankruptcy Filing - Republic National Distributing Company LLC💥
Distribution company flips the framework: sells assets and then files chapter 11 to liquidate
On July 26, 2026, Atlanta-based Republic National Distributing Company, LLC (“RNDC”) and seventeen affiliates (collectively, together with RNDC, the “debtors” and together with their non-debtor affiliates, the “company”) filed chapter 11 bankruptcy cases in the Southern District of Texas (Judge Lopez). Up until recently, the company was a conglomerate that owned and operated the US’s second largest alcohol beverage distributor and if you feel compelled to take a deep drive into the pre-Prohibition era founding of its constituent parts, you are in luck. AlixPartners LLP’s (“Alix”) John Castellano, the company’s CRO, provides a wealth of unnecessary (but still interesting!) info in his first day declaration, going all the way back to 1898.
The TL;DR version is that Newman Goldring, Chris Carlos, Al Davis, and Edward Block …
… got into or re-entered the liquor distribution biz post-Prohibition, grew their businesses over decades, and consolidated into one big happy family through the late ‘90s and ‘00s. The descendants of those long-gone farts still own the company today through New BG Distribution Partners, LLC (“NBG”) and NDC Partners, LLC (“NDC”), which, respectively, have a one-third and two-thirds stake in RNDC.
The company then grew from ‘07 to ‘23 through twelve+ acquisitions and partnerships, bringing its distribution skills to ~19 new states over the following years. At its peak, that generated ~$12b in annual revenue across a cumulative ~40 states and had 10k+ employees.
This is where the story catches up to modern times: COVID happened. Here’s Mr. Castellano with the specifics:
“Before the COVID-19 pandemic, the alcohol industry experienced a prolonged period of steady growth. As government shutdowns forced the closure of restaurants and bars in April 2020, Americans were confined to their homes and increasingly turned to retail stores to purchase alcohol for in-home consumption. Retail and online sales channels saw a corresponding boom, resulting in an approximate 35% increase in retail alcohol sales during the spring of 2020.[] Distributors like RNDC raced to meet this incredible surge in demand by stockpiling unprecedented levels of inventory. Given that retail customers have historically generated the vast majority of RNDC’s revenue, and because RNDC was one of the only distributors with an eCommerce sales channel, RNDC was able to fully capitalize on this historic demand.”
The pandemic waned, demand did too, and the company was left with too much inventory. The kicker? That inventory doesn’t appear to be going anywhere. Back to Mr. Castellano:
“Since 2022, fewer and fewer Americans have reported drinking alcohol; the percentage of adults in the United States that report themselves as regular consumers of alcohol is the lowest it has been in nearly 90 years.”
The US drinking rate is now ~54% because, among other things, the younger crowd seems to prefer CBD/THC — Johnny sure as sh*t does too — and the older ones are on Ozempic.
The upshot of which is that the company is obligated to purchase more booze from its distillery, winery, and brewery suppliers than it can sell to its bar, restaurant, and retail customers.
Those same suppliers are taking a beating too, which, from late ‘22 to ‘25, resulted in the loss of suppliers accounting for $3b+ in annual revenue, including Sazerac, the minds, taste buds, and livers behind Buffalo Trace, Pappy Van Winkle, SoCo, and Blanton’s.
Then mishaps with acquisition partners, and just like that, the company wasn’t able to service its funded debt: ~$1.3b in 1L, ~$260mm in equity-owned 2L, ~$7mm in equipment loans, and $47.7mm in owner notes (PETITION Note: we didn’t include a chart on purpose; you’ll see why). In September and October ‘25, the debtors retained the aforementioned Alix, Kirkland & Ellis LLP (“K&E”), and Lazard Frères & Co. LLC (“Lazard”) to advise, who shook the magic eight ball to reveal the company’s fortunes:
Time for the independents. In November ‘25, Scott Vogel and Charles Piper received the call, followed by John Young, Jr. in December. Meanwhile, the debtors’ 1L lenders and agent — Wells Fargo Bank, N.A. (“Wells”), repped by Paul Hastings LLP — pushed for a 363 sale process.
Which the company didn’t want. Given the heavy regulatory overlay in the alcohol industry, as well as the lack of legal documentation prevalent in it,** it and its advisors didn’t think that would come together in a BK and the debtors would instead be forced to liquidate for pennies on the dollar. Letter-writing ensued,*** but in January ‘26, the company got its way; the lenders pumped in another $250mm to facilitate a sale of the debtors assets in seven, later increased to eleven, markets to Reyes Holdings, L.L.C. (“Reyes”), which closed, subject to an end of year transition services agreement, on May 29, 2026.
To close out other pending sales, including (i) those of Nebraska, North Dakota, and South Dakota to Quality Brands Distribution, LLC, (ii) its wine-searcher.com business, and (iii) JV interests in an Idaho op, the lenders put in another $74mm.
Anyway, the net proceeds brought down the 1L debt ~$1.1b to this petition date figure:
But the lenders still aren’t done. They’re going to toss in another $75mm in new money ($50mm interim) under a DIP to try to find buyers for the assets in ~18 other states and otherwise liquidate the estates, for which they will receive (i) an interim roll-up of the $66.3mm in delay draw term loans ☝️ and (ii) a final order roll-up of ~$108.7mm on the revolver.**** The DIP requires the debtors to (i) file a plan and disclosure statement within five business days, (ii) execute binding purchase agreements for a majority of the going concern sales within thirty days, and (iii) confirm a plan and go effective within, respectively, seventy and seventy-five days.
The plan will also address the 2L and owner notes, and attached to Mr. Castellano’s declaration is the proposed settlement. Under it:
📍One-thirds equity owner New BG Distribution Partners, LLC and its related parties (collectively, “NBG”) will (i) pay $10.25mm to the debtors directly, (ii) waive any claim for expense reimbursement in negotiating the settlement, (iii) waive deferred compensation claims, (iv) waive any right to recovery on their prepetition debt, and (v) agree to the contribution of claims against them to a GUC trust, provided it is covered by a debtor D&O policy.
📍Two-thirds equity owner NDC Partners, LLC and its related parties (collectively, “NDC”) will (i) pay $40mm to the debtors directly and (ii) otherwise agree to the same framework above.
Which, if you’re wondering the reason for the generosity, Mr. Castellano has that too:
“Since 2018, RNDC LLC …”
… which is a pass-through entity for tax purposes …
“… has made more than $700 million in tax distributions to its direct equityholders, New BG Partners and NDC Partners, in proportion to their ownership of RNDC LLC.”
The Goldring, Carlos, Davis, and Block families be clingin’ onto that bag and don’t want too much heat from the debtors’ GUCs, who are estimated to be owed ~$400mm.
While on the topic of decision-making, let’s go back to governance for a moment. All of the sales consummated to date were prepetition. Like within a handful of months. Obviously that could be problematic for Messrs. Vogel, Piper and John Young, Jr. They had a leading role in seeking out, approving, and closing the sales, and naturally, they will want a release under the plan too.
So. What’s a debtor to do?
Simple: add more governance. On June 25, 2026, Jill Frizzley got the call-up as the debtors’ fourth independent and sole member of an “additional special committee.” It’s tasked to look under the hood and … bless her peers’ prior decision-making, 🙄.
Whether that’s ever an issue is for another time. No doubt an official committee of unsecured creditors will have their own estate-funded peek too — at the prepetition sales prices and any assertable claims against the board members and equity.
The court held a ~1.33-hour long first day hearing on July 27, 2026, where the US trustee expressed new, negative feelings toward carveouts but was quickly overruled as all requested relief was granted. The second day hearing is scheduled for August 24, 2026 at 1pm CT.
The debtors are represented by K&E (Joshua Sussberg, Christopher Marcus, Maddison Levine, Joshua Raphael, Rachel Golden, Jennifer Davis) and Porter Hedges LLP (John Higgins, M. Shane Johnson, Megan Young-John, Joanna Caytas) as legal counsel, Alix (John Castellano) as financial advisor and CRO, and Lazard (Christian Tempke) as investment banker. The debtors’ independent managers are Scott Vogel, Charles Piper, John Young, Jr., and Jill Frizzley. Wells, as prepetiton and DIP agents, is represented by Paul Hastings LLP (Justin Rawlins, Geoffrey King, Lindsey Henrikson, Charles Persons) as legal counsel. One-third equity owner NBG is represented by Katten Muchin Rosenman LLP (Steven Reisman, Cindi Giglio, Rachel Riley, Stephen Rochester) as legal counsel, while two-thirds owner NDC is represented by Seward & Kissel LLP (John Ashmead, Robert Gayda, Thomas Hooper, Kwame Akuffo) as legal counsel.
*Namely, the debtors’ entry into CA and AZ was a disaster. In August ‘19, the company purchased a 50% stake in Young’s Market Company, LLC (“YMC”) from Young’s Holdings, Inc. (“YHI”) for $297mm, with respective put and call options for the other 50%. In August ‘22, YHI exercised the put, and the parties disputed the price. Ultimately, the company bought the other half of the equity for $422mm in November ‘22. Another dispute, relating to the termination of the Sazerac relationship, arose too, and to cut to the chase, the company paid YHI another $7.5mm to put it to bed.
**Suppliers and distributors seemingly operate on a handshake model.
***The dec attaches a well-written, January ‘26 letter from K&E to PH about the need for a DIP and the disastrous results that would befall the company if they pursued a wholly in-court transaction. Kudos to the writers.
****The DIP bears interest at SOFR + 8.50% and features a 3% closing fee, a 2% exit fee, and a $375k arranger fee.
Company Professionals:
Legal: Kirkland & Ellis LLP (Joshua Sussberg, Christopher Marcus, Maddison Levine, Joshua Raphael, Rachel Golden, Jennifer Davis) and Porter Hedges LLP (John Higgins, M. Shane Johnson, Megan Young-John, Joanna Caytas)
Financial Advisor/CRO: AlixPartners LLP (John Castellano)
Investment Banker: Lazard Frères & Co. LLC (Christian Tempke)
Strategic Communications Advisor: Joele Frank
Independent Managers: Scott Vogel, Charles Piper, John Young, Jr., Jill Frizzley
Claims Agent: Omni (Click here for free docket access)
Other Parties in Interest:
Wells Fargo Bank, N.A.
Legal: Paul Hastings LLP (Justin Rawlins, Geoffrey King, Lindsey Henrikson, Charles Persons)
Financial Advisor: Carl Marks Advisors
1/3rd Non-Debtor Equity Holder: New BG Distribution Partners, LLC
Legal: Katten Muchin Rosenman LLP (Steven Reisman, Cindi Giglio, Rachel Riley, Stephen Rochester)
2/3rds Non-Debtor Equity Holder: NDC Partners, LLC
Legal: Seward & Kissel LLP (John Ashmead, Robert Gayda, Thomas Hooper, Kwame Akuffo)