(Bloomberg) — Ascend Performance Materials Inc., a chemicals business backed by SK Capital Partners, has filed bankruptcy and said it intends to restructure with support from its lenders.
Houston-based Ascend and its corporate affiliates sought court protection Monday in Texas listing assets and liabilities each of between $1 billion and $10 billion on its Chapter 11 petition.
Ascend said the bankruptcy filing will allow the business to trim debt from its balance sheet while continuing to operate as usual. Company lenders have agreed to provide $250 million in Chapter 11 financing to support Ascend during the restructuring process.
The company said it expects to complete its restructuring in about 6 months. Ascend said its non-U.S. subsidiaries are not included in the Chapter 11 filings.
The bankruptcy filing follows discussions between the company and its lenders to swap out a portion of their debt for equity in the business which has been strapped for cash, Bloomberg previously reported. Some lenders also agreed in March to provide Ascend with new rescue financing, Bloomberg also reported.
SK Capital Partners bought Ascend from Solutia Inc. in 2009 for about $54 million. Ascend then grew rapidly, buying facilities in Europe and China, using capital from a small pool of investors.
Ascend has previously said it is holding talks with lenders to strengthen its finances and maximize value for tis stakeholders.
“Over the last several months, we have been working with our lenders to define the best path forward for Ascend,” Ascend President and Chief Executive Officer Phil McDivitt said in a Monday statement. “We expect that the restructuring will substantially reduce Ascend’s funded debt obligations and ensure that we are well-positioned to continue executing on our long-term strategy.”
–With assistance from Reshmi Basu.
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