Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
Exide Technologies Officially Files for Bankruptcy Law Protection
Author: Joel R. Glucksman
Date: June 21, 2013
Key Contacts
Back
After weeks of speculation, battery manufacturer Exide Technologies has officially sought bankruptcy law protection under Chapter 11 of the U.S. Bankruptcy Code.
Despite its recent attempts to cut costs, the company has been unable to strengthen its finances in light of rising costs for materials and the state’s shutdown of one of its key facilities in Vernon, California. The 125-year-old business filed for protection in the U.S. Bankruptcy Court in Wilmington, Delaware, listing debts of $1.14 billion and assets of $1.89 billion.
Exide, which manufactures lead-acid batteries used in cars, trucks, tractors, and boats in more than 80 countries, said the filing will only affect its U.S. operations. Its U.S. business was impacted heavily by the temporary closing of its Vernon facility, which was shut down on April 24 by the California Department of Toxic Substances and Control for state health violations. In its filing, Exide said the shutdown would cut $24 million from its earnings before taxes, interest, and depreciation, Bloomberg reports.
In addition, the company lost its contract with Wal-Mart Stores, Inc., in 2010, which reduced its sales by $160 million annually. Further, the company was nearing a deadline to pay $31 million in debt interest in August and $51.9 million worth of bonds maturing in September.
“Our restructuring will allow us to strengthen our balance sheet and complete the operational changes that build upon the strategies that we have been pursuing,” said James Bolch, Exide’s chief executive, according to the New York Times. “Over and above these efforts, we intend to become even more aggressive in reducing costs, taking actions with respect to underperforming business segments and to focus on the most attractive areas for future growth.”
Exide said it will continue to operate normally during Chapter 11 proceedings, and has secured $500 million in debtor-in-possession financing from JPMorgan Chase to maintain its operations.
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Breach of Contract Explained: Types and Consequences
Breach of contract disputes are the most common type of business litigation. Therefore, nearly all New York and New Jersey businesses will likely have to deal with a contract dispute at least once. Understanding when to file a breach of contract lawsuit and how long you have to sue for breach of contract is essential […]
Author: Brittany P. Tarabour
How to Dissolve a Corporation in New Jersey: A Step-by-Step Guide
Closing your business can be a difficult and challenging task. For corporations, the process includes formal approval of the dissolution, winding up operations, resolving tax liabilities, and filing all required paperwork. Whether you need to understand how to dissolve a corporation in New York or New Jersey, it’s imperative to take all of the proper […]
Author: Christopher D. Warren
Gross Lease vs. Net Lease: Understanding the Key Differences
Commercial leases can take a variety of forms, which is often confusing for both landlords and tenants. Understanding the different types, especially the gross lease structure, is important when selecting the lease that best suits your needs. One key distinction between lease types is how rent is calculated and paid. This article addresses the two […]
Author: Robert L. Baker, Jr.
What to Do If You Are Impacted by a Retailer Bankruptcy Part 2
Over the past year, brick-and-mortar stores have closed their doors at a record pace. Fluctuating consumer preferences, the rise of online shopping platforms, and ongoing economic uncertainty continue to put pressure on the retail industry. When a retailer seeks bankruptcy protection, a myriad of other businesses are often impacted. Whether you are a supplier, customer, […]
Author: Brian D. Spector
The Current Administration's Proposals for the Financial Services and Banking Industries Will Affect Your Business
Since his inauguration two months ago, Donald Trump’s administration and the Congress it controls have indicated important upcoming policy changes. These changes will impact financial services policies and priorities. The changes will particularly affect cryptocurrency, as well as banking rules and regulations. Key Regulatory Changes in Cryptocurrency For example, in the burgeoning cryptocurrency business environment, […]
Author: Dan Brecher
Tips for Commercial Landlords Impacted by Wave of Retailer Bankruptcies Part 1
The retail sector has experienced a wave of bankruptcy filings over the last year. Brick-and-mortar businesses in financial distress include big-name brands like Big Lots, Party City, The Container Store, and Vitamin Shoppe. When large retailers seek bankruptcy protection, they are not the only businesses impacted. Landlords can be particularly hard hit. While commercial landlords […]
Author: Brian D. Spector
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.