Company cites higher scrap lead prices as one reason for filing.
Exide Technologies, a manufacturer and recycler of lead-acid batteries, has filed a voluntary petition for reorganization in the District of Delaware.
According to an Exide release, only Exide Technologies’ U.S. operations, including its GNB Industrial Division, are included in the bankruptcy filing. Exide Technologies’ international operations are excluded from the filing. The company says it plans to continue to operate globally without interruption during the reorganization.
In a prepared statement, James Bolch, Exide’s president and CEO, said, “Operations, both in the U.S. and in the rest of the world, will continue to serve customers in a timely manner with the same quality products and outstanding customer care as they did before the filing. All post-filing obligations to U.S. suppliers will be paid on time and within terms. We intend to pay U.S. employees as usual and do not expect any material changes to their benefits. Outside of the U.S., obligations to employees and suppliers will not be impacted by the filing.”
To continue to operate while in Chapter 11, Exide has negotiated a $500 million debtor-in-possession (DIP) financing facility.
“Our company has been burdened by a highly leveraged balance sheet, which has limited our ability to competitively invest in our businesses,” Bolch added. “Recently, our profitability has been impacted by unprecedented increases in our product costs — driven primarily by the market price of scrap lead in North America – as well as operational challenges in the U.S. and Europe which we have been unable to fully offset. After a great deal of consideration, we concluded a restructuring of our balance sheet and our operations was the best path forward for the company.”