Exide Technologies Files Voluntary Chapter 11 Petition To Restructure U.S. Operations And Strengthen Balance Sheet
MILTON, Ga., June 10, 2013 /PRNewswire/ -- Exide Technologies, (Nasdaq: XIDE), a global leader in stored electrical solutions, announced today that it has filed a voluntary petition for reorganization pursuant to U.S. federal restructuring laws in order to facilitate the financial and operational restructuring necessary to strengthen its balance sheet and its business to position the Company for future success. The petition was filed in the District of Delaware.
Only Exide Technologies' United States' operations, including the GNB Industrial Division, are included in the filing. Exide Technologies' international operations are excluded from the filing. The Company plans to continue to operate globally without interruption during the reorganization.
James R. Bolch, President and Chief Executive Officer of Exide said, "Operations both in the U.S. and in the rest of the world will continue to serve customers in a timely manner with the same quality products, and outstanding customer care as they did before the filing. All post-filing obligations to U.S. suppliers will be paid on time and within terms. We intend to pay U.S. employees as usual and do not expect any material changes to their benefits. Outside of the U.S., obligations to employees and suppliers will not be impacted by the filing."
Exide has negotiated a $500 million debtor-in-possession (DIP) financing facility to be provided by a group of financial institutions and investors in connection with the filing. Once approved by the Court, this financing will enhance the Company's global liquidity position with approximately $300 million in new capital, in order to allow it to pursue its restructuring goals. The proceeds of the DIP financing together with cash generated from daily operations and cash on hand will be used to fund post-petition operating expenses. Exide's global management team will continue to manage both the U.S. and global businesses.Mr. Bolch stated, "Our Company has been burdened by a highly leveraged balance sheet which has limited our ability to competitively invest in our businesses. Recently, our profitability has been impacted by unprecedented increases in our product costs -- driven primarily by the market price of scrap lead in North America – as well as operational challenges in the U.S. and Europe which we have been unable to fully offset. After a great deal of consideration, we concluded a restructuring of our balance sheet and our operations was the best path forward for the Company." "Our restructuring," he continued, "will allow us to strengthen our balance sheet and complete the operational changes that build upon the strategies that we have been pursuing. 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."
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV