Glass Maker Files for Bankruptcy Protection

Anchor Glass Container Corp. filed for bankruptcy protection April 15, even though the Tampa-based company's leaders say business is the best it's been in two decades.

The filing, which was negotiated with Anchor Glass' creditors and needs to be approved by U.S. Bankruptcy Court, allows the company to cut its debt burden by $50 million and reorganize the remainder of it.

Anchor Glass needs to take such a step because its parent company, Toronto-based Consumers Packing Inc., has filed for bankruptcy protection, which allows Anchor Glass' debt holders to demand their money back, plus interest, through a change-of-control provision.

In effect, because of the parent company's bankruptcy, Anchor Glass might be forced to buy back its bonds from creditors. The company isn't in a position to do that, Chief Operating Officer Richard M. Deneau said.

"Business is very strong, the best it's been in 20 years, and while we have sufficient operating funds, Anchor does not have the cash or liquidity to make the bond repurchase," he said.

Last month, New York- based investment manager Cerberus Capital Management LP agreed to put up $100 million of new capital for Anchor Glass, including about $80 million worth of new shares.