Phoenix Services LLC Files for Voluntary Chapter 11 Reorganization to Implement Next Step in Comprehensive Strategy
Receives Commitment for New Financing
RADNOR, Pa., Sept. 27, 2022 /PRNewswire/ -- Phoenix Services LLC, a premier provider of mission critical services to leading, global steel producing companies, today announced that the Company and certain of its U.S. affiliates have taken the next step in its comprehensive restructuring strategy by filing voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code. In order to support its reorganization efforts, a group of the Company's first lien lenders have committed to provide $50 million in new debtor-in-possession ("DIP") financing, subject to court approval.
The proposed DIP financing will support the Company's operations as it completes the Chapter 11 process. The Company's decision to formally restructure follows an exhaustive review of its long-term contracts while facing inflationary headwinds, supply chain constraints and rising fuel costs. Recognizing the need for a swift resolution of negotiations in order to maintain the high level of safe, reliable service to its customers, the Company looked to a court-supervised process to protect the business from further erosion and implement the next phase of its strategy.
"The steps we are taking now, to address our contract portfolio, will allow us to continue as an integral partner to our customers providing critical services and create a sustainable and profitable structure for the future," said Mark Porto, Chief Executive Officer of Phoenix Services LLC.
The Company filed a series of motions that, pending Court approval, will enable the business to operate normally during the implementation of its strategy, including meeting obligations to its employees. The Company remains dedicated to safety, reliability, and operational excellence.
All international affiliates are excluded from the U.S. process and will continue normal operations.
Phoenix Services LLC is being advised by Weil, Gotshal & Manges LLP and Richards, Layton & Finger, P.A. as its legal advisors, AlixPartners, LLP as its financial advisor and PJT Partners LP as investment bankers.
For additional information about the cases please visit http://cases.stretto.com/phoenix. The Company has also established an Information Line at Toll-Free (855) 275-4273 and for international callers (949) 889-0163.
Phoenix Services
Phoenix Services LLC is dedicated to sustainable solutions and maximizing efficiency for the global steel industry with minimal environmental impact. Services include removal, handling, and processing of molten slag at customer sites, as well as preparation and transportation of metal scraps, raw materials, and finished products.
SOURCE Phoenix Services LLC
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