Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
Exide Technologies Officially Files for Bankruptcy Law Protection
Author: Joel R. Glucksman
Date: June 21, 2013
Key Contacts
Back
After weeks of speculation, battery manufacturer Exide Technologies has officially sought bankruptcy law protection under Chapter 11 of the U.S. Bankruptcy Code.
Despite its recent attempts to cut costs, the company has been unable to strengthen its finances in light of rising costs for materials and the state’s shutdown of one of its key facilities in Vernon, California. The 125-year-old business filed for protection in the U.S. Bankruptcy Court in Wilmington, Delaware, listing debts of $1.14 billion and assets of $1.89 billion.
Exide, which manufactures lead-acid batteries used in cars, trucks, tractors, and boats in more than 80 countries, said the filing will only affect its U.S. operations. Its U.S. business was impacted heavily by the temporary closing of its Vernon facility, which was shut down on April 24 by the California Department of Toxic Substances and Control for state health violations. In its filing, Exide said the shutdown would cut $24 million from its earnings before taxes, interest, and depreciation, Bloomberg reports.
In addition, the company lost its contract with Wal-Mart Stores, Inc., in 2010, which reduced its sales by $160 million annually. Further, the company was nearing a deadline to pay $31 million in debt interest in August and $51.9 million worth of bonds maturing in September.
“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,” said James Bolch, Exide’s chief executive, according to the New York Times. “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 said it will continue to operate normally during Chapter 11 proceedings, and has secured $500 million in debtor-in-possession financing from JPMorgan Chase to maintain its operations.
- Practices: Corporate Transactions & Business, Bankruptcy & Creditors' Rights, 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
New Jersey’s Next Manufacturing Tax Credit: Stability Secured, Timing Matters
A Settled Regulatory Environment Enables Confident Capital Planning New Jersey’s new manufacturing incentive program, Next New Jersey Manufacturing Program, enters 2026 with something uncommon in economic development these days: policy stability. The statute is enacted, New Jersey Economic Development Authority’s (“NJEDA”) rules are adopted, and the application portal is open. With the election outcome settled, […]
Author: Michael J. Sheppeard
A Simple Guide to Industry Roll-Up Acquisitions
When done successfully, industry roll-up acquisitions can dramatically grow and strengthen your business. In this post, we break down what an industry roll-up is, why companies pursue it, and what makes it an effective (and sometimes risky) business strategy. What Is an Industry Roll-Up Acquisition? In an industry roll-up acquisition of companies, a buyer acquires multiple companies […]
Author: Dan Brecher
Genesis Mission: How the U.S. Government’s New AI Platform Will Reshape Corporate Innovation, Risk, and Competition
The federal government has launched one of the most ambitious scientific initiatives in decades, and it will redefine how companies develop technology, manage risk, and compete. The Genesis Mission, created by Executive Order and driven by the Department of Energy (“DOE”), is intended to accelerate scientific discovery through a national AI platform that links supercomputers, […]
Author: Michael J. Sheppeard
Stablecoins and the GENIUS Act: How New Global Rules Are Reshaping Compliance
Stablecoins Leave the Grey Zone Stablecoins were supposed to be the “boring” part of crypto: digital dollars that just work. Yet for years they have lived in a regulatory no-man’s-land, classified one day as securities, the next as commodities, and sometimes as something regulators had not even named yet. That uncertainty is finally starting to […]
Author: Bryce S. Robins
Don’t Overlook the Importance of Business License Management
If you operate a business without the proper license, you risk fines, insurance issues, reputational harm, and even business closure. Even innocent mistakes, like forgetting to renew a license, can have significant consequences, such as losing your lawsuit for payment of services that are unlicensed, which makes it imperative to have business license management procedures […]
Author: Dan Brecher
Failing to Comply With NJ Rent Control Exemption May Prove Costly
What Developers Need to Know About New Jersey’s Rent Control Exemption Law to Ensure Entitlement to Exemption for Newly Constructed Multi-family Housing. A property owner in Jersey City is facing a $400 million federal class action lawsuit alleging that the landlord did not follow the procedural steps required to be eligible for exemption from local […]
Author: Patrick T. Conlon
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.