BREAKING NEWS/MEDIA ROUND-UP: Exide files for Chapter 11 bankruptcy protection; gets tentative approval for $500 million debtor-in-possession loan
Exide Wins Initial Loan Approval to Operate in Bankruptcy
Exide Technologies (XIDE), the 125-year-old battery maker, won initial court approval to borrow as much as $500 million to replace older loans and stay in business while it reorganizes in bankruptcy.
About $225 million of the new debt will go to pay off and replace a $160 million revolving credit line, with any money left over used for operations, according to court papers. The other $275 million will be partly supplied by a group of noteholders that holds 45 percent of the company’s bonds that mature in 2018.
The new loans “are a strong endorsement of the company’s efforts to restore itself to profitability as a going concern,” the company said in papers filed yesterday in U.S. Bankruptcy Court in Wilmington, Delaware.
Exide, based in Milton, Georgia, filed for bankruptcy yesterday after state regulators shut down the company’s lead-recycling plant in Vernon, California. The April closing forced Exide to speed up its restructuring plans by hiring law firm Skadden, Arps, Slate, Meagher & Flom LLP and financial adviser Alvarez & Marsal North America LLC, according to court records.
With today’s interim approval by U.S. Bankruptcy Judge Kevin Carey, the company will get access to about $170 million of the new debt. The rest of the loans can’t be disbursed unless Carey gives final approval after allowing creditors to object at a hearing to be scheduled in coming weeks.
The case is In re Exide Technologies, 13-11482, U.S Bankruptcy Court, District of Delaware (Wilmington).
To contact the reporter on this story: Steven Church in Wilmington, Delaware at firstname.lastname@example.org
DOW JONES DAILY BANKRUPTCY REVIEW
Bondholders Seek Leverage in Exide’s Chapter 11 Case
Peg Brickley, Dow Jones Daily Bankruptcy Review
June 11, 2013
(c) 2013 Dow Jones & Company, Inc.
Bondholders are circling Exide Technologies Inc . looking for leverage in a Chapter 11 bankruptcy case that is shaping into a fast-moving revamp of the global battery business.
“We want to see a smooth and quick case,” said Alice Belisle Eaton of Paul Weiss Rifkind Wharton & Garrison LLP , speaking at Exide’s debut hearing in the U.S. Bankruptcy Court in Wilmington, Del.
Owners of about 45% of Exide’s $675 million senior secured notes, members of the bondholder group have been negotiating with the company for about a month, Ms. Eaton said.
Some bondholders are providing a major portion of the bankruptcy financing that won provisional approval Tuesday. That puts them in position to sway many key decisions as Exide works to get its debts in line with rising costs and sagging revenue.
Terms of the loan provisionally approved by Judge Kevin Carey, call for Exide to file a Chapter 11 restructuring plan acceptable to the bankruptcy financiers within nine months.
Parts of the bankruptcy loan deal are being opened up to bondholders outside the committee, Ms. Eaton said, in response to a flurry of calls from investors seeking a safe spot on the ailing company’s balance sheet.
Bankruptcy financing will be paid off before most other debts and is anchored by Exide’s overseas businesses as well as U.S. operations. It also carries some $24 million in fees, including fees for syndication agent J.P. Morgan Chase & Co .
Hurt by the global economic retraction and trouble with toxic substance regulators in California, Exide filed for Chapter 11 protection Monday, over $1 billion in debt.
Landing the Chapter 11 loan was a crucial prelude to the filing, said company attorney Kenneth Ziman of Skadden Arps Slate Meagher & Flom LLP .
“Our costs are up, revenues are flat to down, we’ve got too much debt that requires interest payments that stifle our ability to invest,” Mr. Ziman said. “We commenced this to get liquidity.”
Exide will need free cash as it works toward a bankruptcy exit plan, because there’s no protection from creditors outside the U.S., where more than half the company’s earnings before interest, taxes, depreciation and amortization are generated.
As Exide slid toward its second bankruptcy in 11 years, bond investors took a beating. The April 24 decision by the California Department of Toxic Substances Control that led to the shutdown of Exide’s Vernon lead battery recycling plant was particularly punishing.
Senior secured bonds, which had been selling for 78 cents on the dollar prior to the April ruling, dropped 10 points almost immediately. Bankruptcy saw them selling for about 55 cents on the dollar.
Convertible bonds, a $52 million issue, were selling in the range of five cents to six cents on the dollar Tuesday, down from around 10 cents on the dollar last week, and far off the 79 cents on the dollar they fetched before the April word from California.
As for shareholders, bankruptcy is generally bad news, and Exide’s isn’t likely to be one of the few cases that’s an exception to the rule that equity loses all. One of the few remaining items of business from Exide’s previous trip through Chapter 11 is a fight over a claim that, if Exide loses, will be paid off in company stock. Mr. Ziman said Tuesday the court fight over the claim is likely to be stayed until it’s determined whether it’s worth anyone’s time to go to court over Exide stock.
Exide will return to court in July to seek final approval on the bankruptcy loan, which may run as high as $500 million.
Write to Peg Brickley at email@example.com.
Exide files for Chapter 11 bankruptcy
Exide Technologies filed for Chapter 11 bankruptcy protection Monday, though Frisco officials say cleanup of land surrounding the company’s former Frisco plant will proceed as normal.
The company, which manufactures and recycles car batteries, will continue day-to-day business operations, having secured $500 million in financing and named a restructuring officer to oversee its reorganization. Bankruptcy filing documents indicate Exide had about $1.89 billion in total assets against $1.14 in total debt as of March 31.
Exide and the city of Frisco reached an agreement last year that required the company to demolish its Frisco plant and clean the surrounding land. As part of the deal, the city would acquire about 180 acres of land and Exide would receive $45 million after completing its requirements.
In its bankruptcy filing, Exide called the closure of the Frisco plant part of its “steps to reposition its business and to consolidate its North American operations.” The plant closed on Nov. 30, resulting in the immediate layoff of about 120 employees.
Frisco Mayor Maher Maso said city officials spoke with Exide on Monday morning to discuss the impact the bankruptcy will have on the cleanup process.
“We have an agreement and contract with Exide, and the company has assured us they are going to honor that,” he said. “We’re moving ahead in the process, and they’ve said they have every intention of living up to the terms of our agreement.”
When asked if the city’s contract with Exide had a bankruptcy contingency, Maso said no such condition exists but noted the city considered that option when the deal was made.
“You don’t put every contingency in contracts, and there’s nothing [about bankruptcy] in there, and clearly as a publicly traded company they’re not going to want to put that in there — they have all sorts of rules they have to work under,” he said. “We look at all contingencies along the way. We always try to think of options for any issues that may come up. We’re comfortable with the process — it’s been positive so far.”
A court filing for the bankruptcy cited rising product costs and increased competition as reasons for Exide’s financial difficulties.
Lead, the material previously recycled at its Frisco plant, makes up about 46 percent of Exide’s cost of goods sold, yet increased battery recycling costs have decreased the company’s operating margins. The increased costs were exacerbated by the recent shutdown of a lead-acid battery recycling plant in Vernon, Calif.
Exide came under fire from California regulators in recent months, sending its stock into a nosedive. The regulators ordered Exide to close its Vernon plant on April 24, saying the plant’s hazardous waste and emissions posed “an unacceptable risk to human health.” The company’s stock plummeted following the Vernon plant’s closure; Exide stock opened at 15 cents a share in trading Monday, down from a 52-week high of $3.77.
The company also lost a key contract when Walmart signed an exclusive contract with Johnson Controls, Exide’s primary competitor, for car batteries. In its bankruptcy filing, Exide estimated the loss of Walmart’s business costs the company $160 million in annual revenue.
Exide previously filed for bankruptcy in 2002 after accumulating $2.5 billion in debt. A judge approved a restructuring plan in 2004 that cut the company’s debt by $1.3 billion, allowing the company to exit bankruptcy.
Environmental advocacy groups overseeing the cleanup of Exide’s former Frisco plant said the company’s bankruptcy may be positive for the city in the long run if the company agrees to sell about 100 acres of land its former plant resides on. The land the city agreed to acquire surrounds that land.
“If Exide had remained a solvent company, they were planning on holding on to that land forever and never getting rid of it,” said Jim Schermbeck, director of Downwinders at Risk. “Now they might be willing to sell the land cheaply to the city or someone else. That could get rid of the landfills that reside on the property. The bill for cleaning up the location is big, but the return on investment is big as well.”
THE ASSOCIATED PRESS / WFAA – for Frisco-related information
Exide Files for Chapter 11 Bankruptcy Protection
by TOM MURPHY
Posted on June 10, 2013 at 8:33 AM
Updated today at 3:13 PM
The Milton, Ga., company said its international operations are excluded from the filing, which it made Monday in U.S. Bankruptcy Court in Delaware.
Exide Technologies makes batteries for vehicles and also provides stored electrical energy services for industrial applications.
It said a highly leveraged balance sheet has limited its ability to invest in its businesses, and recent unprecedented increases in product costs have hurt its profitability. Those increases have been driven mainly by the North American market price for scrap lead.
Exide’s voluntary petition for Chapter 11 protection prevents debt collectors from collecting amounts owed by the company. Bankruptcy court filings show that the company had debts totaling about $1.14 billion and assets valued at $1.89 billion as of April 30.
Creditors with the largest unsecured claims include Wilmington Trust, National Association, which has $51.9 million in convertible senior subordinated notes. Oracle Credit Corp. has a $4.1 million claim, and Richardson Molding Inc. has one totaling nearly $2.9 million.
Exide said the filing does not change the work schedules of its plants, corporate offices or branches, and the company expects to continue serving both U.S. and international customers. Exide runs 13 manufacturing locations in the United States and 74 branches through North America.
The company also said it plans to pay U.S. employees as usual, and it does not expect material changes to their benefits.
Exide’s battery plant in Frisco officially closed last November, and the company is working with the Texas Commission on Enviromental Quality (TCEQ) to clean up the plant site. The TCEQ said in a statement the bankruptcy won’t effect cleanup of the site.
“The TCEQ has a strong and well-established bankruptcy program for dealing with such issues,” the statement said. “The agency, in conjunction with the Office of the Attorney General, will pursue all appropriate avenues for environmental compliance. At the present time, the TCEQ continues to work with the company, the EPA, the City of Frisco and the community on the cleanup and closure of the Exide Frisco property. “
The City of Frisco has also been in touch with the company, and city officials told News 8 Exide has reassured the city they will honor their committment to clean the site.
Exide has negotiated $500 million in financing that will help cover operating expenses after the filing. Its board of directors also has named Robert M. Caruso chief restructuring officer. Caruso is a managing director of the restructuring firm Alvarez and Marsal.
The battery maker said in April it had hired the financial advisory firm Lazard to help it explore financing options. It had reported a string of quarterly losses before then.
Shares of Exide have plunged since closing 2012 at $3.42. The stock closed at 20 cents on Friday and then fell another 8 cents, or 40 percent, to 12 cents in premarket trading Monday before markets opened.
THE WALL STREET JOURNAL
Battery Maker Exide Files for Bankruptcy Protection
Troubled automotive battery maker Exide Technologies Inc. XIDE -3.47% filed for Chapter 11 bankruptcy protection on Monday for the second time in 11 years, citing aWal-Mart Stores Inc. WMT -0.76% decision to stop buying its products as a factor.
Exide said it would continue producing batteries for auto makers and other customers as it works on a restructuring plan. Exide faced $31 million in interest payments in August and the maturity of nearly $52 million in convertible notes in September.
“At this point we don’t have any plans to close additional facilities,” Chief Executive Jim Bolch said in an interview on Monday. He said he wouldn’t speculate on layoffs in the future. The bankruptcy filing only affects Exide operations in the U.S., Mr. Bolch said.
The company makes lead-acid batteries for cars, boats, and other machines under a variety of brand names including Exide and NorthStar. Its customers include auto makers, parts suppliers and retailers. Exide employs about 10,000 people in more than 80 countries, and listed assets of about $1.9 billion and debts of $1.1 billion in its Chapter 11 petition.
Exide has lined up a $500 million bankruptcy loan from J.P. Morgan ChaseJPM +0.17% & Co. to fund its restructuring, such as working capital, investment in the business and continuing operations, Mr. Bolch said.
In court papers, Exide said Wal-Mart’s decision to designate Exide’s main rival,Johnson Controls Inc., JCI -0.11% as its sole supplier of transportation batteries in 2010 resulted in a loss of about $160 million in annual revenue.
The company also is grappling with troubles at a California lead-recycling facility that supplies a “significant portion” of its domestic lead. In April, Exide was forced to suspend operations at the Vernon, Calif., plant under an order from the California Department of Toxic Substances Control, which claimed the facility’s storm-water system violated state regulations. Exide said the shutdown will wipe out about $24 million in projected earnings before interest, taxes, depreciation and amortization.
“We have been working very closely with the regulators since this whole event unfolded,” Mr. Bolch said. “We’re focused on getting the plant reopened…obviously sooner is better, we don’t have a defined time yet.”
Bankruptcy lenders are giving the company six months to come up with an acceptable business plan and nine months to file a Chapter 11 restructuring plan that lenders would approve, court papers said. Investors that own a “substantial percentage” of Exide’s $675 million of senior secured notes have agreed to go along with the bankruptcy financing, according to the company, and some of those investors may participate in the loan.
Exide Files for Bankruptcy After Losing Wal-Mart Business
After the April shutdown in Vernon, California, Exide sped up its restructuring plans by hiring law firm Skadden, Arps, Slate, Meagher & Flom LLP and financial adviser Alvarez & Marsal North America LLC, according to court records.
“As a result of the Vernon shutdown and the company’s poor financial performance in the fourth fiscal quarter of 2013, it became apparent that a successful out-of-court restructuring was unlikely,” Chief Financial Officer Phillip Damaska said in a filing today in U.S. Bankruptcy Court in Wilmington, Delaware.
The company, based in Milton, Georgia, listed debts of $1.14 billion and assets of $1.89 billion in its Chapter 11 filing. The filing won’t affect obligations outside the U.S., Exide said in a statement. Exide has about 3,600 employees and operations in more than 80 countries, making lead-acid batteries used in cars, trucks, tractors and boats.
The California Department of Toxic Substances and Control ordered Exide to suspend operations at the recycling plant on April 24, saying the facility didn’t comply with state health standards, the company said the next day in a regulatory filing.
Exide said it disputes the regulators’ findings and is fighting to reopen the plant. In the meantime, the company has a short-term source to replace lead it got from the Vernon plant and is trying to secure a long-term supply, according to court papers.
The company began a restructuring effort after Wal-Mart Stores Inc. (WMT) in 2010 switched to Johnson Controls Inc. (JCI) to supply automotive batteries, Damaska said in the filing. The loss of Wal-Mart as a customer reduced Exide’s sales by about $160 million a year, he said. Wal-Mart, based in Bentonville, Arkansas, is the world’s largest retailer.
The closing of the Vernon plant will cut about $24 million from Exide’s earnings before taxes, interest and depreciation, a common financial measure known as Ebitda, Damaska said.
Exide also blamed the economic slowdown in Europe, where it gets about half of its revenue. In the first three months of this year, Ebitda fell to $14 million from $54 million in the same period in 2012, the company said.
Exide fell 10 percent to 18 cents at 12:21 p.m. New York time in Nasdaq Stock Market trading. The shares earlier plunged as much as 36 percent. They closed at $3.74 on Jan. 8.
The company’s 8.625 percent bonds due in 2018 climbed more than 3 percent to 60.375 cents on the dollar, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. Exide issued the bonds in 2011, when it borrowed $675 million.
The company has $31 million in interest payments due in August, Damaska said. Among the largest unsecured creditors listed in court papers are holders of $51.9 million in floating-rate convertible notes due in September.
Exide is asking a judge’s permission to borrow as much as $500 million from lenders led by JPMorgan Chase & Co. to help carry it through bankruptcy, according to court papers.
The case is In re Exide Technologies, 13-11482, U.S Bankruptcy Court, District of Delaware (Wilmington).
To contact the reporters on this story: Steven Church in Wilmington, Delaware firstname.lastname@example.org Joe Schneider in Sydney at email@example.com; Phil Milford in Wilmington; firstname.lastname@example.org
THE NEW YORK TIMES
Exide Technologies, a major manufacturer of car and truck batteries, filed for bankruptcy protection on Monday as it sought to repair its finances amid rising costs for materials and the shutdown of an important operation.
As of March 31, Exide had $1.9 billion in assets and $1.1 billion in liabilities, according to a court filing with the federal bankruptcy court in Delaware.
The company will continue to operate normally while in Chapter 11, and has secured $500 million in financing from JPMorgan Chase to keep its operations running. It also named Robert M. Caruso of the consulting firm Alvarez & Marsal as its chief restructuring officer.
In acourt filing, the company cited the price of scrap lead in North America, which accounts for 40 percent of its costs of goods sold. It has also grappled with intense competition from its primary rival, Johnson Controls, which poached Wal-Mart Stores as an exclusive customer.
Exide had also struggled with its big exposure to the European market, which makes up more than 51 percent of its revenue. The company also faced $31 million in debt interest payments due in August and $51.9 million worth of bonds maturing in September.
In perhaps the final straw, Exide experienced an enormous setback when California’s Department of Toxic Substances Control ordered the suspension of a lead recycling facility for failing to comply with state regulations.
Exide’s shares have fallen 92 percent in the last 12 months, closing on Friday at 20 cents apiece.
“Our restructuring will allow us to strengthen our balance sheet and complete the operational changes that build upon the strategies that we have been pursuing,” James R. Bolch, Exide’s chief executive, said in a statement. “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.”
Its biggest unsecured creditors include Wilmington Trust, which represents $51.9 million worth of bonds, and the Oracle Corporation.
The company, based in Milton, Ga., has 3,600 employees.
It is being advised by Lazard and the law firms Skadden, Arps, Slate, Meagher & Flom and Pachulski Stang Ziehl & Jones.
Battery maker Exide Technologies files for bankruptcy
Mon Jun 10, 2013 2:40am EDT
(Reuters) – U.S. battery maker Exide Technologies (XIDE.O) filed for Chapter 11 bankruptcy protection early on Monday, court documents showed, with the aim of cutting debt and implementing a restructuring plan to better compete in the market.
Exide, which makes lead-acid batteries, said in the court filing that a combination of rising production costs, intense competition and the economic downturn in Europe had led to liquidity constraints.
Also, higher spent-battery costs and lead-related price increases have put pressure on the company’s margins, Exide said, adding that taking the Chapter 11 route would be the best option to restructure its finances and operations.
“In recent years, competition in the battery industry has intensified, especially in the auto parts retail and mass merchandise channels where large customers are able to use their buying power to negotiate lower prices and longer payment terms, or move business elsewhere if their demands are not met,” Exide said.
In 2010, Wal-Mart Stores Inc (WMT.N), one of Exide’s then major customers, chose Exide’s principal rival Johnson Controls Inc (JCI.N) as its sole supplier of transportation batteries and stopped carrying Exide’s rival products.
Exide said Wal-Mart’s switch resulted in a loss of about $160 million in annual revenue.
“More significantly, in addition to the revenue lost from Wal-Mart sales, Exide also lost an important and reliable source of battery cores under a captive-core arrangement with Wal-Mart,” the company added.
Operations in Europe, which is experiencing a prolonged economic downturn, accounted for about 51.2 percent of the company’s worldwide revenue.
Exide estimated its liabilities at $1.14 billion and assets at more than $1.89 billion, according to the court filing.
The company said the Chapter 11 filing applies to the U.S. parent only and its international operations are excluded.
It has also secured $500 million in debtor-in-possession (DIP) financing and expects to pay U.S. employees as usual and does not expect any material changes to their benefits.
The case is Exide Technologies, Case No. 13-11482, U.S. Bankruptcy Court, District of Delaware.
(Reporting by Sakthi Prasad in Bangalore; Editing by David Holmes)
Facing $31M in interest payments in August and the maturity of almost $52M in convertible debt…
Monday, June 10, 3:45 AM ET
Facing $31M in interest payments in August and the maturity of almost $52M in convertible debt a month later, Exide Technologies (XIDE) has filed for bankruptcy protection with liabilities of $1.14B and assets of over $1.89B. It’s the lead-acid battery company’s second filing in 11 years. Exide cited rising costs, Europe’s slowdown and intense competition as reasons for its current problems. Exide has obtained a $500M bankruptcy loan from JPMorgan (JPM). (PR)
KPCC 89.3 – SOUTHERN CALIFORNA PUBLIC RADIO – Vernon, CA Exide plant information
State officials shut down operations at Exide Technologies in Vernon, Calif. in April due to toxic air pollution that may pose health risks to members of the surrounding community. The plant is now open again.
The owner of a troubled lead-battery recycling plant in Vernon has filed for bankruptcy protection.
Exide Technologies reported $1.9 billion in assets and $1.1 billion in liabilities as of the end of last quarter. By entering Chapter 11, the company is likely to avoid paying off maturing bonds and payments for debt interest, both due later this year.
The state’s Department of Toxic Substances Control shuttered Exide’s Vernon plant in April. DTSC justified its suspension order two ways. First, a health risk assessment prepared by regional air officials found sharply elevated cancer risk in the surrounding areas from arsenic emissions. Second, an inspection of the stormwater system at the facility revealed gashes in underground pipes rendering the system faulty.
Exide had filed a notice of defense to challenge the DTSC’s suspension. What was supposed to be a three-day hearing last week proved more complicated than lawyers anticipated. Now the Office of Administrative Hearings is seeking to schedule and complete the hearing sometime this summer.
Exide’s stock has dropped precipitously over the last year, losing more than 90 percent of its value. News of the bankruptcy filing has sent it down further, with shares trading around 17 cents apiece as of mid-day Monday.
THE CITY WIRE
Fort Smith plant owner files for bankruptcy
In the documents filed over the weekend and announced early Monday (June 10), officials with the battery-making company blamed the financial bind on Wal-Mart Stores Inc., the continued economic woes in the European market and the high price of lead.
The company has 13 manufacturing operations in the U.S., including the Fort Smith plant located at the corner of Zero Street and Old Greenwood Road, and 74 branch operations which sell and distribute products. Exide has 3,600 U.S. employees, with 1,100 salaried and 2,500 hourly, including 540 union workers.
Susan Jaramillo, a communications consultant with Exide, said the Fort Smith plant employs 231 – 193 hourly and 38 salaried.
Exide’s industrial batteries are used in the material handling industry for electric fork-lift trucks as well as in other machinery, including floor cleaning machinery, powered wheelchairs, railroad locomotives, mining equipment, and electric road vehicles. Also, the company’s “network” power batteries provide energy storage for systems that require uninterrupted power supply and are used to power telecommunications systems, computer installations and data centers, hospitals, air traffic control systems, security systems, electric utilities, railways, and various military applications.
Only the company’s U.S. operations, including the GNB Industrial Division, are part of the filing. The international operations are excluded from the filing, and Exide plans to continue to operate globally without interruption during the reorganization. The company is using GCG as administrative agent between the company and the Court through the bankruptcy proceedings. The company said it has more than 20,000 creditors.
In the bankruptcy documents, Exide said higher production costs, “intense” competition, ongoing struggles in the European market and increased difficulty in obtaining affordable credit resulted in the decision to reorganize.
Exide officials said in the documents that competition has “intensified” with large retailers able to “use their buying power to negotiate lower prices and longer payment terms,” or to simply cut off the supplier.
“In this regard, one of Exide’s then major customers, Wal-Mart Stores Inc., designated Johnson Controls — Exide’s principal competitor — its sole-source supplier of transportation batteries and stopped carrying Exide’s transportation products. This switch resulted in Exide’s loss of approximately $160 million in annual revenue. More significantly, in addition to the revenue lost from Wal-Mart sales, Exide also lost an important and reliable source of battery cores under a captive-core arrangement with Wal-Mart,” noted an Exide bankruptcy document.
Following the loss of the Wal-Mart business, Exide moved to reduce expenses by closing its Frisco, Texas, plant and idling its Reading, Penn., smelting operation.
Exide was also hit with higher costs when operations at its Vernon, Calif., lead recycling plant were suspended by the federal Environmental Protection Agency. On April 24, 2013, the EPA suspended the operations, saying the plant’s storm-water system was not in compliance with state requirements. The shutdown forced Exide to use third-party lead recyclers which is expected to reduce the company’s bottom line by $24 million in the six-month period following the shutdown.
The cost of lead is also a problem.
“Suppliers of raw materials have subjected Exide to pricing premiums, and Exide has been unable to pass along higher production costs to customers,” according to the filing.
The company said Monday the reorganization should not change business operations or employee pay.
However, it’s possible that not all operations, products and services will survive the reorganization.
Bolch said in the statement that the restructuring “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.”
Exide secured $500 million debtor-in-possession (DIP) financing through a group of financial institutions and investors in connection with the filing.
Exide noted in its statement: “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.”