Truck parts maker Accuride files for Chapter 11 bankruptcy
Liabilities estimated between $500M and $1B
Commercial-truck parts maker Accuride Corp. filed for Chapter 11 bankruptcy protection after the company burned through cash amid a freight industry recession in the US.
The firm said its liabilities were estimated to be between $500 million and $1 billion, and gave the same range for its asset, according to a company filing on Wednesday. S&P Global Ratings said in July that weaker-than-expected demand for Accuride’s products increased risks of a default or restructuring.
Accuride is the latest company in US transport sector to file for bankruptcy this year amid overcapacity in the freight industry that’s hurting both truckers and parts suppliers. The manufacturer’s failure comes after lenders had agreed last year to give it more time to repay debt in exchange for an injection of funds from private equity backer Crestview Partners.
The wheel maker said in a separate statement that it is “hopeful” that it can emerge from bankruptcy in 90-100 days after agreeing with lenders to restructure its North American business. The pact will significantly reduce debt from its balance sheet, it added.
Accuride’s Canadian entity also commenced a proceeding for creditor protection and will seek approval for a proposed reorganization plan, the firm said. Mexican, European, and Asian subsidiaries of the company aren’t included in the latest filings.
The company’s agreement with lenders provides the firm with $30 million of financing to continue normal operations, according to the statement. All Accuride’s plants will carry on business as usual.
— By Finbarr Flynn and Janine Phakdeetham (Bloomberg)
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