Pitney Bowes Announces Agreement in Principle with Unsecured Creditors’ Committee in DRF Logistics Bankruptcy Case to Resolve Outstanding Disputes

Rhea-AI Summary

Pitney Bowes (NYSE: PBI) has reached an agreement in principle with DRF Logistics 's unsecured creditors' committee to resolve ongoing disputes in DRF's bankruptcy case. The agreement is expected to facilitate DRF's exit from bankruptcy by the end of 2024, ahead of initial expectations. The company maintains its target of approximately $150 million in one-time costs from the wind-down process. The agreement will be documented in a revised chapter 11 plan, with a confirmation hearing scheduled for November 19, 2024.

Positive

• Expected completion of DRF bankruptcy exit ahead of schedule by end of 2024
• Agreement provides certainty regarding bankruptcy exit parameters

Negative

• One-time costs of approximately $150 million for the wind-down process
• Agreement terms remain subject to ongoing discussions and documentation

Insights

Legal & Financial Analyst

The agreement in principle with DRF Logistics' unsecured creditors marks a significant development in Pitney Bowes' strategic exit from its Global Ecommerce segment. The resolution maintains the expected $150 million one-time cost projection and accelerates the completion timeline to end-2024. This structured exit demonstrates prudent financial management and will allow PBI to redirect resources toward its core profitable segments.

The expedited timeline and maintained cost estimates suggest effective negotiation and risk management. For investors, this represents reduced uncertainty around the wind-down process and better visibility into future operations. The company's ability to reach an agreement with creditors while maintaining projected costs indicates strong execution of its restructuring strategy.

Resolution Will Pave the Way for Completion of GEC Exit by End of 2024

STAMFORD, Conn.--(BUSINESS WIRE)-- Pitney Bowes Inc. (NYSE: PBI) (“Pitney Bowes” or the “Company”), a technology-driven company that provides SaaS shipping solutions, mailing innovation, and financial services to clients around the world, today announced that it has reached an agreement in principle (the “Agreement in Principle”) with DRF Logistics LLC (“DRF”) (f/k/a the Global Ecommerce segment) to resolve ongoing disputes with the official committee of unsecured creditors (the “Committee”). The Committee is tasked with representing the interests of all creditors asserting unsecured claims against DRF and its affiliated debtor.

Lance Rosenzweig, Pitney Bowes’ Chief Executive Officer, commented:

“This Agreement in Principle represents an important milestone in the DRF wind-down process and resolves the Committee’s disputes on fair and reasonable terms. We believe that this deal is favorable to the Company and, critically, provides us with a high degree of certainty with respect to the parameters of DRF’s expeditious exit from bankruptcy. We expect to remain firmly on track to complete the exit by the end of 2024, ahead of our initial expectations, and continue to target approximately $150 million in one-time costs from the wind-down. We look forward to closing this chapter and continuing to focus on our significant opportunities for profitable growth in our remaining businesses.”

Certain terms of the Agreement in Principle remain subject to ongoing discussions and documentation, and thus no result can be assured at this time. The Agreement in Principle will be documented in a revised chapter 11 plan of DRF, which will be filed with the bankruptcy court in advance of the currently scheduled confirmation hearing on November 19, 2024.

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About Pitney Bowes

Pitney Bowes (NYSE: PBI) is a technology-driven company that provides SaaS shipping solutions, mailing innovation, and financial services to clients around the world – including more than 90 percent of the Fortune 500. Small businesses to large enterprises, and government entities rely on Pitney Bowes to reduce the complexity of sending mail and parcels. For the latest news, corporate announcements, and financial results, visit www.pitneybowes.com/us/newsroom. For additional information, visit Pitney Bowes at www.pitneybowes.com.

Forward-Looking Statements

This document contains “forward-looking statements” about the Company’s expected or potential future business and financial performance. Forward-looking statements include, but are not limited to, statements about the Company’s expectations related to the DRF bankruptcy proceedings, future revenue and earnings guidance, future events or conditions, and expected cost savings, elimination of future losses, and anticipated deleveraging in connection with Pitney Bowes’ announced strategic initiatives. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that could cause actual results to differ materially from those projected. Factors which could cause future financial performance to differ materially from expectations include, without limitation, declining physical mail volumes; changes in postal regulations or the operations and financial health of posts in the U.S. or other major markets or changes to the broader postal or shipping markets; the potential adverse effects and risks and uncertainties associated with the GEC exit and wind-down on the Company’s operations, management and employees, and the ability to successfully implement the Company’s 2024 worldwide cost reduction and optimization initiatives and realize the expected benefits therefrom, the loss of some of Pitney Bowes’ larger clients in the Presort Services segments; the loss of, or significant changes to, United States Postal Service (USPS) commercial programs, or the Company’s contractual relationships with the USPS or their performance under those contracts; and other factors as more fully outlined in the Company's 2023 Form 10-K Annual Report and other reports filed with the Securities and Exchange Commission during 2024. Pitney Bowes assumes no obligation to update any forward-looking statements contained in this document as a result of new information, events or developments.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241113761449/en/

Alex Brown

investorrelations@pb.com

OR

Longacre Square Partners

Joe Germani

jgermani@longacresquare.com

Source: Pitney Bowes Inc.

FAQ

What is the expected timeline for Pitney Bowes (PBI) DRF Logistics bankruptcy exit?

Pitney Bowes expects to complete DRF Logistics' exit from bankruptcy by the end of 2024, ahead of initial expectations.

How much will the DRF Logistics wind-down cost Pitney Bowes (PBI)?

Pitney Bowes targets approximately $150 million in one-time costs for the DRF Logistics wind-down process.

When is the confirmation hearing for Pitney Bowes (PBI) DRF bankruptcy plan?

The confirmation hearing for DRF's revised chapter 11 plan is scheduled for November 19, 2024.