Discovery Zone Cleared for New Financing

Discovery Zone Inc. will be allowed to obtain an additional $5 million in financing, U.S. Bankruptcy Judge Helen Balick ruled. The company, which operates indoor entertainment centers for children, has not been able to generate revenue this year at the same level it did in 1995, an attorney for the company said. Discovery Zone, in Chapter 11 reorganization since March, reported a loss from operations of $73 million and a final loss of $455 million for 1995. Discovery Zone will borrow the $5 million from Perry Partners LP of New York, which has already loaned Discovery Zone $25 million in post-petition bankruptcy financing. Fort Lauderdale, Fla.-based Discovery Zone is expected to emerge from reorganization in late March.