Dayton Superior Files Voluntary Chapter 11 Petition and Arranges $165 Million DIP Financing Facility
20 Avril 2009 - 12:09AM
Business Wire
Dayton Superior Corporation (NASDAQ: DSUP), the leading North
American provider of specialized products for the nonresidential
concrete construction market, today announced that the Company has
decided to pursue its previously announced debt restructuring
efforts under court protection by filing a voluntary petition for
reorganization under chapter 11 of the U.S. Bankruptcy Code in the
United States Bankruptcy Court for the District of Delaware in
Wilmington.
�We had sincerely hoped to restructure our debt outside of the
court,� said Eric R. Zimmerman, Dayton Superior�s President and
Chief Executive Officer. �However, in light of the unprecedented
tight credit markets, we determined that this filing is the best
possible course of action to achieve a sustainable long-term
financial structure and secure the Company�s future growth and
profitability. We will pursue a consensual plan of reorganization
and debt restructuring under court protection while maintaining
normal business operations.�
The Company said it has arranged for a twelve-month
debtor-in-possession (DIP) credit facility from GE Capital of up to
$165 million. The DIP facility will replace the Company�s existing
$150 million revolving credit facility. The DIP facility will
provide immediate liquidity to the Company to help fund operations
during the reorganization, subject only to court approval and other
customary conditions. The Company will seek prompt court approval
of the DIP facility and authority to continue operating its
business and serving its customers in the ordinary course,
including the authority to make wage and salary payments to
employees and to continue to make payments to suppliers.
Zimmerman continued, �We intend to fulfill our commitments to
our employees, customers and suppliers without interruption while
we restructure our debt. It is our goal to emerge from
reorganization expeditiously as a stronger company with greater
flexibility, lower debt and a sustainable long-term capital
structure.�
Zimmerman emphasized that the current situation is a result of
the tight credit markets and the timing of the Company�s debt
maturities and is not related to operations. �Dayton Superior is
the leading company in our industry. Although we are certainly
feeling the effects of the recession, in 2008 we reported
all-time-high operating income of $45 million on net sales of $476
million. The 9.5% operating margin was also a record. Our current
level of bid activity for quoting infrastructure projects is up
20-30% over a year ago due in large part to the federal stimulus
plan. We are optimistic about the future as we enter the
reorganization process.�
In the court filing, the Company listed assets of $286 million
against liabilities of $413 million. Liabilities include
approximately $161 million in principal and accrued interest on the
Company�s 13% Senior Subordinated Notes due 2009 and $222 million
in outstanding borrowings under the Company�s senior secured credit
facilities.
Additional information about the filing for creditors and other
parties will be available through a link on the Company website,
www.daytonsuperior.com.
While the Company is in chapter 11, investments in its
securities will be highly speculative. Investors should assume that
shares of the Company's common stock have little or no value and
will likely be cancelled upon consummation of the Company�s
reorganization. The Company anticipates that its common stock will
be delisted from trading on the NASDAQ National Market. The Company
expects to cease filing periodic and other reports with the
Securities and Exchange Commission, effective immediately. Certain
information concerning the Company will be available in the
bankruptcy.
The outcome of the chapter 11 restructuring case is uncertain
and subject to substantial risk. There can be no assurance that the
Company will be successful in achieving its financial
reorganization.
ABOUT DAYTON SUPERIOR
CORPORATION
Dayton Superior is the leading North American provider of
specialized products consumed in nonresidential, concrete
construction, and we are the largest concrete forming and shoring
rental company serving the domestic, nonresidential construction
market. Our products can be found on construction sites nationwide
and are used in nonresidential construction projects, including:
infrastructure projects, such as highways, bridges, airports, power
plants and water management projects; institutional projects, such
as schools, stadiums, hospitals and government buildings; and
commercial projects, such as retail stores, offices and
recreational, distribution and manufacturing facilities.
Note: Certain statements made herein concerning
anticipated future performance are forward-looking statements.
These forward-looking statements are based on estimates,
projections, beliefs and assumptions of management and are not
guarantees of future performance. Actual future performance,
outcomes and results may differ materially from those expressed in
forward-looking statements as a result of a number of important
factors. Representative examples of these factors include (without
limitation):
- Depressed or fluctuating market
conditions for the Company�s products and services;
- operating restrictions imposed
by the Company�s existing debt;
- increased raw material costs and
operating expenses;
- the ability to increase
manufacturing efficiency, leverage purchasing power and broaden the
Company�s distribution network;
- the competitive nature of the
nonresidential construction industry in general, as well as
specific market areas;
- the Company�s ability to obtain
court approval with respect to its motions in the chapter 11
proceedings;
- the ability of the Company to
obtain approval of and operate pursuant to the terms of the DIP
facility;
- the ability of the Company to
prosecute, develop and consummate a plan of reorganization with
respect to the chapter 11 proceedings;
- risks associated with
third-party motions in the chapter 11 proceedings, which may
interfere with the Company�s ability to develop and consummate a
consensual plan of reorganization; and
- the potential adverse effects of
the chapter 11 proceedings on the Company�s liquidity or results of
operations.
This list of factors is not intended to be exhaustive, and
additional information concerning relevant risk factors can be
found in Dayton Superior�s Annual Report on Form 10?K, Quarterly
Reports on Form 10?Q, and Current Reports on Form 8?K filed with
the Securities and Exchange Commission.
In drawing conclusions set out in our forward-looking statements
above, we have assumed, among other things: the ability of the
Company to obtain court approval with respect to its motions in the
chapter 11 proceedings; the ability of the Company to obtain
approval of and operate pursuant to the terms of the DIP facility;
the ability of the Company to prosecute, develop and consummate a
plan of reorganization with respect to the chapter 11 proceedings;
that the Company will be able to manage the risks associated with
third party motions in the chapter 11 proceedings and they will not
interfere with the Company�s ability to develop and consummate a
plan of reorganization; the Company will be able to adequately
manage any potential adverse effects of the chapter 11 proceedings
on the Company�s liquidity or results of operations.
Dayton Superior Corp (MM) (NASDAQ:DSUP)
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