Tyres & Accessories – Truck wheel-maker Accuride Corp. has settled on a “debt restructuring agreement” that will result in the voluntary filing of Chapter 11 bankruptcy.
Accuride secured $50 million “debtor-in-possession” credit facility to enable normal business to continue while in bankruptcy, accoridng to the company.
Upon making the announcement on Oct. 8, Accuride provided the reassurance that all of its operations will continue to operate in a “business as usual” manner. Furthermore, it states the company’s Canadian and Mexican subsidiaries are not included in the bankruptcy filing. The Accuride press statement expressed the hope the company will be “able to emerge from bankruptcy on an expedited basis with a confirmed plan of reorganisation.”
“Accuride’s debt restructuring efforts are designed to create a sustainable capital structure that will support greater profitability and solidify the company’s position as the market leader in its product categories,” said Bill Lasky, Accuride’s president, CEO, and chairman. “Accuride expects to quickly emerge from Chapter 11 having rationalised its capital structure and de-levered its balance sheet. I believe this restructuring transaction maximises our financial flexibility and positions Accuride for future growth.”
As part of the debt restructuring plans, the company’s 8.5% senior subordinated notes will be cancelled and noteholders will receive 98% of the reorganised Accuride’s common stock, subject to dilution. The reorganised Accuride will complete a $140 million rights offering of new senior unsecured convertible notes to current noteholders. The new notes will be convertible into 60% of the common stock of the reorganised Accuride.
