Libbey, a person of the world’s premier makers of glass tableware, filed Chapter eleven bankruptcy on Monday, citing the “unprecedented” impact of the coronavirus pandemic on demand for its merchandise.
The corporation 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 restaurant sales channel.
A 7-calendar year, $440 million bank loan was scheduled to experienced past thirty day period.
But Libbey explained Monday that it experienced been “unable to offset the steep decrease in sales” resulting from the pandemic, leaving it with no option but to file bankruptcy for the to start with time in its 202-calendar year history.
“While we entered 2020 with positive momentum from our sturdy finish in 2019, the spectacular and extended impact of COVID-19 on the demand for our merchandise and on our organization is definitely unparalleled in Libbey’s extra than 200-calendar year history,” CEO Mike Bauer explained in a information launch.
Libbey’s loan companies have agreed to give up to $a hundred and sixty million in funding to maintain it working through the Chapter eleven method. “Entering this method is a important step to deal with our liquidity, improve our harmony sheet and much better position Libbey for the future,” Bauer included.
The corporation, which was established in 1818 as the New England Glass Company, sells merchandise this sort of as tumblers, stemware, mugs, bowls, shot glasses, canisters, and candleholders by food-assistance, retail and organization-to-organization channels.
Foods-assistance sales in the U.S. and Canada have been declining thanks to “take-out and delivery rising in level of popularity relative to in-restaurant eating,” Brian Whittman, Libbey’s restructuring guide, explained in a court declaration.
Other headwinds, he explained, have integrated the migration of customer acquiring from brick-and-mortar suppliers to on the web commerce and “increased aggressive pressures in Latin America, as Chinese producers divert sales of their merchandise from the U.S. marketplace to Latin America in buy to keep away from the greater tariffs imposed by the United States on Chinese imports.”
Bauer explained Libbey is now viewing some enhancement in demand with the gradual lifting of stay-at-house limitations and the resumption of production in Toledo and Shreveport.