DURHAM, N.C.--(BUSINESS WIRE)--Reichhold, Inc. announced today that it has filed for voluntary protection under Chapter 11 of the U.S. Bankruptcy Code in the District of Delaware. This action was taken to facilitate a restructuring of the debts of Reichhold, Inc. which represents only the U.S. portion of the global Reichhold organization.
The Company announced that it has arranged $130 million USD in financing from its bondholders to fund continuing operations, of which $100 million (subject to court approval) will be available to Reichhold, Inc. in the form of debtor-in-possession (DIP) financing. The financing will also be used in part to repay the Company’s and its affiliates’ existing secured financing in North America and Europe. The bondholders will also serve as the stalking horse bidder for the U.S. business in a 363 sale process to be conducted over the next few months.
Reichhold affiliates located outside the U.S. are not included in the filings. These entities will continue to function outside of the Chapter 11 process and they have the necessary liquidity to continue their operations in the ordinary course of business.
Reichhold has filed a number of customary motions seeking court authorization to continue to support its business operations during the bankruptcy process, including the payment of employee salaries and health benefits without interruption. The goal is to continue its relationships with customers and suppliers in the ordinary course of business.
“For over 85 years, Reichhold has provided value to our global customers. All of Reichhold’s operations are open and serving customers as usual. We have the full support of our bondholders and will emerge from this process even more capable of developing and delivering the innovative products and services that our customers value,” said John S. Gaither, Chairman, President and CEO of Reichhold Industries, Inc.
Additional information is available on Reichhold’s website at www.Reichhold.com or by calling Reichhold’s Restructuring Hotline, toll-free in the U.S. at (844) 246-9934. For calls originating outside the U.S., please call +1 (919) 558-2300.
Cole, Schotz, Meisel, Forman & Leonard, P.A. (legal advisor) and CDG Group LLC (financial advisor) are representing Reichhold, Inc. Latham & Watkins LLP (legal advisor) and Moelis & Company (investment banker) are serving Reichhold Industries, Inc.
Founded in 1927, Reichhold, with its world headquarters and technology center in Durham, North Carolina, USA, is one of the world’s largest manufacturer of unsaturated polyester resins and a leading supplier of coating resins for the industrial, transportation, building and construction, marine, consumer and graphic arts markets. Reichhold has manufacturing operations throughout North America, Latin America, the Middle East, Europe and Asia.
This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended, and Section 221E of the Securities and Exchange Act of 1934, as amended that are subject to risks, uncertainties and other important factors, including, among other things, the ability of Reichhold to develop, prosecute, confirm and consummate one or more Chapter 11 plans of reorganization, and the potential adverse impact of the Chapter 11 filing on operations, and on relations with customers, suppliers and others. All forward- looking statements reflect Reichhold’s expectations only as of the date of this release and should not be relied upon as reflecting Reichhold’s views, expectations, or beliefs at any date subsequent to the date of this release.