Wolverine Tube Exits Chapter 11
06/29/2011 - Wolverine Tube, Inc. has emerged from Chapter 11 bankruptcy protection effective June 28, 2011, pursuant to a Plan of Reorganization approved by the U.S. Bankruptcy Court for the District of Delaware.
Wolverine Tube, Inc. has emerged from Chapter 11 bankruptcy protection effective June 28, 2011, pursuant to a Plan of Reorganization approved by the U.S. Bankruptcy Court for the District of Delaware.
"As planned, Wolverine maintained its business as usual through the reorganization process, paid all unsecured creditors in full, and successfully completed the restructuring with significantly reduced debt," said Steven S. Elbaum, Chairman of Wolverine. "As a result, Wolverine has a manageable amount of debt, tangible net equity of an estimated $60-$70 million (subject to confirmation of the "fresh start" accounting), and adequate liquidity to meet its foreseeable working capital and capital investment needs."
Under the Plan, $139 million of senior secured notes and accrued interest at the petition date has been converted to equity plus a $30 million note. The company's defined pension plan was terminated and assumed by the Pension Benefit Guaranty Corp. in exchange for 5% equity in the company and a stream of payments over 11 years with a present value of approximately $13 million.
The company exits Chapter 11 as a privately held company with its former senior secured noteholders holding a substantial majority of the stock. All old Wolverine common and preferred shares are cancelled.
"Our business plan will focus on improving positive operating income, free cash flow, and strengthening our competitiveness through continuous improvements and new product development. We are well positioned to compete successfully," said Harold M. Karp, President and Chief Operating Officer.
Wolverine Tube, Inc. is a global leader in offering proprietary custom-engineered components that provide a thermal management solution for customers in multiple markets including HVAC, refrigeration and appliance, electronics cooling, power generation, petrochemical and chemical processing. The company delivers advanced metal surface technology enhancements for heat transfer solutions.
