NEW YORK Exide Technologies Inc., a leading producer and
recycler of lead-acid batteries, has filed for Chapter 11
bankruptcy protection, listing assets of about $1.89 billion
and liabilities of about $1.14 billion.
The Milton, Ga.-based companys 20 largest creditors hold
unsecured claims in excess of $71 million, according to
documents filed June 10 in U.S. Bankruptcy Court in Delaware.
Some of the largest unsecured creditors listed in the petition
are metals companies, including Fort Smith, Ark.-based
Copperfab Inc. and Lancaster, N.Y.-based Seibel Modern Mfg
& Welding Corp. Neither company immediately returned calls
The battery maker cited a number of factors that contributed to
a sharp decline in the companys earnings and liquidity
position, including rising production costs, compressed
margins, intense domestic competition, exposure to the
struggling European market and constrained liquidity due to
downgrades from credit-ratings agencies.
The news comes on the heels of several months of turmoil for
Exide, including the suspension of operations at its Vernon,
Calif., recycling facility following a company report that
showed hazardous waste had degraded the facilitys
underground pipes, releasing water bearing toxic metals into
the soil (
amm.com, April 25
Prior to notice of the plants temporary shutdown, a
class-action lawsuit was filed in connection with alleged
arsenic emissions at the facility (
amm.com, April 17
As a result of the Vernon shutdown and the companys
poor financial performance in the fourth fiscal quarter of
2013, it became apparent that a successful out-of-court
restructuring was unlikely, Phillip Damaska, Exides
executive vice president and chief financial officer, said in
Damaska added that with approximately $31 million in interest
payments due in August 2013 and the upcoming maturity of $51.9
million remaining in convertible notes due in September 2013,
the company was forced to implement a restructuring plan to
address these near-term liquidity events.
The filing only applies to Exides U.S. parent company,
and global businesses will continue to operate during
reorganization, the company said.
Operations both in the U.S. and in the rest of the world
will continue to serve customers in a timely manner with the
same quality products and outstanding customer care as they did
before the filing, James R. Bolch, president and chief
executive officer of Exide, said in a statement.
All post-filing obligations to U.S. suppliers will be
paid on time and within terms. We intend to pay U.S. employees
as usual and do not expect any material changes to their
benefits. Outside of the U.S., obligations to employees and
suppliers will not be impacted by the filing.