Libbey, a person of the world’s premier makers of glass tableware, submitted Chapter eleven bankruptcy on Monday, citing the “unprecedented” effects of the coronavirus pandemic on desire for its solutions.
The company experienced been pursuing a restructuring of its harmony sheet even ahead of the pandemic pressured it to close its factories in Toledo, Ohio, and Shreveport, La., and virtually shut down its cafe income channel.
A 7-yr, $440 million mortgage was scheduled to mature final thirty day period.
But Libbey mentioned Monday that it experienced been “unable to offset the steep decline in sales” ensuing from the pandemic, leaving it with no selection but to file bankruptcy for the 1st time in its 202-yr heritage.
“While we entered 2020 with constructive momentum from our robust complete in 2019, the extraordinary and extended effects of COVID-19 on the desire for our solutions and on our enterprise is actually unparalleled in Libbey’s far more than two hundred-yr heritage,” CEO Mike Bauer mentioned in a news release.
Libbey’s loan providers have agreed to deliver up to $160 million in funding to continue to keep it working in the course of the Chapter eleven approach. “Entering this approach is a important phase to address our liquidity, strengthen our harmony sheet and better posture Libbey for the future,” Bauer added.
The company, which was established in 1818 as the New England Glass Corporation, sells solutions this kind of as tumblers, stemware, mugs, bowls, shot eyeglasses, canisters, and candleholders by means of food stuff-company, retail and enterprise-to-enterprise channels.
Food stuff-company income in the U.S. and Canada have been declining because of to “take-out and shipping increasing in attractiveness relative to in-cafe eating,” Brian Whittman, Libbey’s restructuring consultant, mentioned in a court docket declaration.
Other headwinds, he mentioned, have involved the migration of client paying for from brick-and-mortar shops to on the web commerce and “increased competitive pressures in Latin The us, as Chinese makers divert income of their solutions from the U.S. sector to Latin The us in buy to prevent the greater tariffs imposed by the United States on Chinese imports.”
Bauer mentioned Libbey is already looking at some advancement in desire with the gradual lifting of remain-at-property limits and the resumption of creation in Toledo and Shreveport.