Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
Vertellus Specialties Inc. files for Chapter 11 Bankruptcy
Author: Joel R. Glucksman
Date: July 13, 2016
Key Contacts
Back
Vertellus Specialties Inc. files Chapter 11
Vertellus Specialties Inc., a major U.S. chemical manufacturer, recently announced that it had filed for Chapter 11 bankruptcy protection for its domestic operations. According to The Wall Street Journal, the company reached an agreement with its term lenders to seek an auction sale for the majority of its remaining assets.
Vertellus Specialties spirals into debt
In its bankruptcy documents, Vertellus Specialties stated that its decision to file its bankruptcy petition came after it failed to make a recent loan repayment and received a downgrade from several ratings firms. The Journal noted that Moody’s had recently downgraded the company’s credit rating due to “significant earnings deterioration” in the agriculture industry, emerging environmental liabilities risks and stiffening competition from Chinese competitors.
As a result of its recent struggles, Vertellus Specialties has $576 million in total assets, but more than $710 million in total liabilities with an additional $25 million debt total. These liabilities include a $455 million senior secured first lien term loan.
Vertellus Specialties’ reorganization plan
The opening bid from lenders at the pending auction sale will be for $453.8 million in the form of a credit bid. This lender bid will offer to cancel the debt rather than providing cash into the company, which will be part of a term loan of a $546 million load of funded debt.
In the meantime, The Journal reported that the company has also secured $110 million in debtor-in-possession financing from Black Diamond Capital Management, BlackRock, BlueBay Asset Management, Brightwood Capital Advisors and TPG Special Situations Partners to maintain normal operations throughout the auction.
This court-supervised auction sale will be part of the company’s plan to emerge from the reorganization process as a viable business.
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.
- Practices: Bankruptcy & Creditors' Rights, Corporate Transactions & Business, Bankruptcy Litigation
- 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
Failing to Comply With NJ Rent Control Exemption May Prove Costly
What Developers Need to Know About New Jersey’s Rent Control Exemption Law to Ensure Entitlement to Exemption for Newly Constructed Multi-family Housing. A property owner in Jersey City is facing a $400 million federal class action lawsuit alleging that the landlord did not follow the procedural steps required to be eligible for exemption from local […]
Author: Patrick T. Conlon
Crypto Securities Law: When Tokens Become Investment Contracts
The application of traditional federal securities laws to crypto assets continues to evolve. In some cases, the Securities and Exchange Commission (SEC) considers tokens and other digital assets to be securities. This makes them subject to federal securities law, including the Securities Act of 1933 and the Securities Exchange Act of 1934. This classification has […]
Author: Bryce S. Robins
The Due Diligence Process for NY Condominiums and Cooperatives
While the New York City real estate market can be extremely competitive, moving too quickly often backfires. Before purchasing a condominium or cooperative in New York City, it is important to do you homework. Purchasing property in NYC can involve a dizzying number of legal issues. These include condo and co-op rules, rent restrictions, and […]
Author: Jesse M. Dimitro
Smart Contract Legal Issues: Drafting Agreements for Blockchain
Smart contracts feature a unique blend of legal agreement and technical code. This innovation has the potential to reshape how business is conducted. At the same time, smart contract legal issues around enforceability, jurisdiction, identity, and compliance are common. The legal framework for these self-executing agreements is still evolving. What Are Smart Contracts? Smart contracts, […]
Author: Bryce S. Robins
Are Stay Interviews the Key to Retaining Top Talent?
Retaining top talent continues to be one of the greatest challenges facing employers today. Even in an employer’s market, the loss of a key employee can disrupt operations and result in significant costs. While compensation plays a role, long-term retention often depends on workplace culture, communication, and employee engagement. One increasingly popular strategy for improving […]
Author: Angela A. Turiano
Why Secured Transactions Are Important
Secured transactions form the backbone of a wide range of business dealings, including business loans, mortgages, and inventory financing. Because the stakes are often high and relatively minor oversights can have drastic consequences, lenders and borrowers should thoroughly understand how to form an enforceable security agreement that protects their legal rights. What Is a Secured […]
Author: Dan Brecher
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.