Exide faces bankruptcy in US
Wednesday, 3 June 2020
Milton, GA, United States
Exide is a global provider of stored electrical-energy solutions
Battery giant Exide, a significant supplier to the materials handling sector, has filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of Delaware.
The company has received authorisation from the court to pay employees in the usual manner and to continue their health and welfare benefits programs, continue to manufacture and deliver product to customers, and pay suppliers for goods and services provided to the company post-petition.
The Court also approved on an interim basis the USD40 million in Debtor-in-Possession (DIP) financing from a group of lenders, including certain of its existing noteholders. This DIP financing will provide sufficient liquidity to support ongoing operations in North America for the duration of the sale process and restructuring.
The Court will hold hearings on 18 June 2020 to consider the final orders regarding Exide's motions, including the final approval of the DIP financing.
Faced with debts estimated at USD820 million and hundreds of millions of dollars of environmental problems, Exide is planning to "sell our North American Business and (to reach) an agreement to sell our EMEA (Europe, Middle East and Africa) and Asia Pacific business to its long-time lenders," the company says in a statement.
A company source stresses that the Chapter 11 filing covers only the US business and that Exide "has separately reached an agreement to sell its EMEA and Asia Pacific business to an ad hoc group of its noteholders, subject to certain conditions outlined in the transaction documents, and subject to higher or better offers. This business is not included in the Chapter 11 proceedings and continues to operate as usual."
For more than 130 years, Exide Technologies has been a global provider of stored electrical-energy solutions, operating in 80 countries with more than 8,000 employees.