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
Common Legal Mistakes NYC and New Jersey Business Owners Make
Operating a business in the New Jersey and New York City metropolitan region offers incredible opportunities, but it also requires navigating a dense and highly regulated legal environment. From entity formation to regulatory compliance, seemingly minor legal oversights can expose business owners to significant risk. In our work with businesses throughout the region, our attorneys […]
Author: Dan Brecher
What Founders Can Learn From Start-up Suits
High-profile founder litigation is more than just a media spectacle. For startup founders, these cases underscore the legal and structural risks that can arise when rapid growth outpaces formal oversight. While launching a new company can be both an exciting and deeply rewarding endeavor, founders must be mindful that it also comes with significant risks. […]
Author: Dan Brecher
Corporate Governance Reviews: A Practical Guide for New Jersey Companies
Every New Jersey company should periodically evaluate its governance framework. Strong corporate governance protects directors and officers, builds investor confidence, reduces litigation exposure, and positions a company for sustainable growth. The first quarter of the year is a great time to evaluate your corporate governance practices and perform any routine maintenance needed to keep that […]
Author: Ken Hollenbeck
What to Do After Being Served with a Lawsuit: Steps to Protect Your Legal Rights
Being served with a lawsuit is one of the most stressful legal events a business or individual can face. Whether the claim involves a contract dispute, an employment matter, an intellectual property issue, or another legal challenge, the actions you take in the first few days can significantly shape the outcome of your case. Acting […]
Author: Robert E. Levy
Will 2026 Be a Banner Year for SPACs? Understanding the Risks and Opportunities
Special Purpose Acquisition Companies (SPACs) continue to gain momentum as we move through 2026. After enduring a significant contraction following the 2021 boom and the regulatory scrutiny that followed, SPAC activity rebounded sharply in 2025 and now carries forward into 2026 with real momentum. The SPAC resurgence reflects broader improvements in both market conditions and the […]
Author: Dan Brecher
Why Compliance Monitoring Matters for NY and NJ Businesses
Compliance programs are no longer judged by how they look on paper, but by how they function in the real world. Compliance monitoring is the ongoing process of reviewing, testing, and evaluating whether policies, procedures, and controls are being followed—and whether they are actually working. What Is Compliance Monitoring? In today’s heightened regulatory environment, compliance […]
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.