Newsletter #069 (View other news stories)
LID LIFTED ON CLARK MHC'S CH 11 EXIT STRATEGY
LEXINGTON, United States
Thursday, 8 Aug 2002
Clark Material Handling Company will emerge from Chapter 11 bankruptcy by year-end following court approval this week of a planned USD25 million financing arrangement with private equity firm Sun Capital Partners, Inc.
In an exclusive interview with Forkliftaction.com News, Clark MHC chief executive Kevin Reardon said the company was confident it would re-enter the marketplace as a fully-funded entity in December "unless something crazy happens".
Under the agreement, approved by the US Bankruptcy Court in Wilmington, Clark has 75 days to tender a plan for reorganisation, and allow Sun Capital to perform due diligence. Mr Reardon said the plan should be tendered by the end of this month.
"The plan then enters a 25-day approval process, after which the court will give us a hearing, so we expect that to be in early October," he said. "The hearing will set a 60-day clock on which the approval and plan is acted upon, meaning that, unless something crazy happens, Clark will emerge from Chapter 11 status by December at the latest.
"I see nothing in the woodpile that would jeopardise this plan."
Assuming the plan proceeds smoothly, Mr Reardon said debtors owed about USD252 million before Clark's Chapter 11 filing would be offered settlements by Sun Capital, leaving the company with USD90 million of debt with German and Asian banks. Deferment would be negotiated on those debts, Mr Reardon said.
"We have focused on fixing the business and completing all the industrial restructuring necessary to attract new investors," Mr Reardon said. "I am very appreciative of our dealers, customers and suppliers who have supported Clark through this difficult period, and we are extremely excited about Clark's future.
"Obtaining and receiving approval to begin implementing this plan represents an important step in (the) reorganisation process."
Clark applied for and won Chapter 11 debt protection in April 2000, listing assets of USD349 million and liabilities of USD374 million as at February 2000.
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