Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comThornton & Co. Files for Chapter 11 Bankruptcy
Author: Joel R. Glucksman|September 23, 2015
Thornton & Co.’s debt accumulates due to industry collapse
Thornton & Co. Files for Chapter 11 Bankruptcy
Thornton & Co.’s debt accumulates due to industry collapse
On Aug. 10, one of the largest resin distributors and resellers in the U.S., Thornton & Co. Inc., announced that it had filed for Chapter 11 bankruptcy protection. The company further stated that it intends to repay its suppliers through a partial orderly liquidation.
The resin distributor cited its leveraged capital structure and a significant drop in petrochemical prices as the primary reason it sought bankruptcy protection. Prices have fallen to 25 cents per pound since November 2014, including 10 cent drops in December and January. As a result of this price collapse, Thornton’s sales have fallen over 20 percent since 2014, forcing the company to sell its inventory on hand at a significant loss.
In its bankruptcy filing, the company listed assets between $10 million and $50 million, and liabilities between $10 million and $50 million. Thornton’s unsecured creditors include many of its competitors in North America, as the distributor owes $2.1 million to Formosa Plastics Corp. USA, $2.2 million to Westlake Chemical Corp., $1.3 million to Equistar Chemicals LP and $1 million to Chevron Phillips Chemical Co.
Thornton’s proposal to repay its suppliers and fulfill its debt obligations to creditors was rejected by Peoples United Bank in July, which necessitated the bankruptcy filing.
The company hopes to seek out potential investors to maintain operations and emerge from the bankruptcy process as a viable business when the market recovers. According to a Plastics News interview with CEO Jake Thornton, the firm also plans to sell off a portion of its resin inventory to facilitate its debt repayment to creditors.
In court papers, Thornton announced that it plans to work with Gordian Group LLC as its financial adviser.
Thornton is currently working with Peoples Bank to restructure the rejected proposal in an attempt to bring value to its suppliers.
Company officials also stated in bankruptcy documents that they hope to benefit from large private equity resin capacity expansions that are expected within the next three years. However, according to a report by the American Chemistry Council cited in Plastics News, North American resin producers have significantly cut back on the number of distributors and resellers they contract with since 2014, leaving Thornton with an uncertain future.
Are you a creditor in a bankruptcy? Have you been sued by a bankrupt? If you have any questions about your rights, please contact me, Joel Glucksman, at 201-806-3364.
Thornton & Co. Files for Chapter 11 Bankruptcy
Author: Joel R. Glucksman
On Aug. 10, one of the largest resin distributors and resellers in the U.S., Thornton & Co. Inc., announced that it had filed for Chapter 11 bankruptcy protection. The company further stated that it intends to repay its suppliers through a partial orderly liquidation.
The resin distributor cited its leveraged capital structure and a significant drop in petrochemical prices as the primary reason it sought bankruptcy protection. Prices have fallen to 25 cents per pound since November 2014, including 10 cent drops in December and January. As a result of this price collapse, Thornton’s sales have fallen over 20 percent since 2014, forcing the company to sell its inventory on hand at a significant loss.
In its bankruptcy filing, the company listed assets between $10 million and $50 million, and liabilities between $10 million and $50 million. Thornton’s unsecured creditors include many of its competitors in North America, as the distributor owes $2.1 million to Formosa Plastics Corp. USA, $2.2 million to Westlake Chemical Corp., $1.3 million to Equistar Chemicals LP and $1 million to Chevron Phillips Chemical Co.
Thornton’s proposal to repay its suppliers and fulfill its debt obligations to creditors was rejected by Peoples United Bank in July, which necessitated the bankruptcy filing.
The company hopes to seek out potential investors to maintain operations and emerge from the bankruptcy process as a viable business when the market recovers. According to a Plastics News interview with CEO Jake Thornton, the firm also plans to sell off a portion of its resin inventory to facilitate its debt repayment to creditors.
In court papers, Thornton announced that it plans to work with Gordian Group LLC as its financial adviser.
Thornton is currently working with Peoples Bank to restructure the rejected proposal in an attempt to bring value to its suppliers.
Company officials also stated in bankruptcy documents that they hope to benefit from large private equity resin capacity expansions that are expected within the next three years. However, according to a report by the American Chemistry Council cited in Plastics News, North American resin producers have significantly cut back on the number of distributors and resellers they contract with since 2014, leaving Thornton with an uncertain future.
Are you a creditor in a bankruptcy? Have you been sued by a bankrupt? If you have any questions about your rights, please contact me, Joel Glucksman, at 201-806-3364.
