FOR IMMEDIATE RELEASE
O-I Glass, Inc. (“O-I Glass” or the “Company”)
today announced that its wholly owned subsidiary, Paddock
Enterprises, LLC (“Paddock”), has voluntarily filed for relief
under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy
Court for the District of Delaware to equitably and finally resolve
all of its current and future asbestos-related claims.
On December 27, 2019, O-I Glass announced the
adoption of a new holding company structure whereby O-I Glass
became the new parent entity with Owens-Illinois Group, Inc. (“O-I
Group”) and Paddock as direct, wholly owned subsidiaries. The
Company’s legacy asbestos-related liabilities are isolated within
Paddock, structurally separating them from the Company’s
glass-making operations, which remain under O-I Group. O-I Glass
and O-I Group are not included in the Chapter 11 filing and will
continue to operate as usual throughout Paddock’s Chapter 11
process.
Andres Lopez, CEO of O-I Glass, said,
“Addressing Paddock’s legacy liabilities through Chapter 11 will
help enable O-I Glass to further unlock the value creation
potential of this global franchise. By improving the Company’s
capital structure, this important step will support a number of
critical strategic efforts and possibilities as O-I Glass leverages
its position as the world's leading manufacturer of sustainable
glass packaging.”
After exiting a business in 1958 that produced
Kaylo, an asbestos-containing thermal insulation product, the
Company has disposed of over 400,000 asbestos-related claims and
incurred gross expense of approximately $5 billion for
asbestos-related costs. Lopez continued, “Paddock evaluated its
options and determined that a Chapter 11 plan of reorganization was
the most fair and equitable way to obtain certainty and finality in
addressing its legacy asbestos-related liabilities. Pending final
resolution of the Chapter 11 proceeding, all asbestos-related
claims payments will be suspended.”
Paddock’s ultimate goal in its Chapter 11 case
is to confirm a plan of reorganization under Section 524(g) of the
U.S. Bankruptcy Code and utilize this specialized provision to
establish a trust that will address all current and future
asbestos-related claims. Paddock has been and remains committed to
fairly and equitably compensating claimants who are ill and have
legitimate exposure to the Kaylo products manufactured by its
predecessor from 1948-1958. Paddock looks forward to working
swiftly and constructively to confirm a plan of reorganization and
is committed to emerging from bankruptcy as expediently as
possible. Additional information about the Chapter 11
case can be found at:https://cases.primeclerk.com/Paddock
Paddock is advised in this matter by Latham & Watkins LLP and
Alvarez & Marsal.
Prepared Remarks Scheduled for January 6,
2020
O-I Glass CEO Andres Lopez and CFO John Haudrich
will conduct a conference call to discuss these developments on
Monday, January 6, 2020, at 10:30 a.m. EST. Given the court-related
procedural activities initiated today with Paddock’s Chapter 11
filing, management will share prepared remarks, however the
conference call will not include a question and answer
session. A live webcast of the conference call, including
presentation materials, will be available on the O-I
Glass website, www.o-i.com/investors, in the Webcasts and
Presentations section.
The conference call also may be accessed by
dialing 888-733-1701 (U.S. and Canada) or 706-634-4943
(international) by 10:20 a.m. EST, on January 6, 2020. Ask for the
O-I Glass conference call. A replay of the call will be available
on the O-I Glass website, www.o-i.com/investors, for a year
following the call.
O-I Glass news releases are available on the O-I Glass website
at www.o-i.com.
O-I Glass’s fourth quarter and full year 2019 earnings
conference call and webcast is currently scheduled for Wednesday,
February 5, 2020, at 8:00 a.m. EST.
About O-I Glass At O-I
Glass, Inc. (NYSE: OI), we love glass and we’re proud to make more
of it than any other glass bottle or jar producer in the world. We
love that it’s beautiful, pure and completely recyclable. With
global headquarters in Perrysburg, Ohio, we are the preferred
partner for many of the world’s leading food and beverage brands.
Working hand and hand with our customers, we give our passion and
expertise to make their bottles iconic and help build their brands
around the world. With more than 26,500 people at 78 plants in 23
countries, O-I Glass has a global impact, achieving revenues of
$6.9 billion in 2018. For more information, visit o-i.com.
Forward-Looking Statements
This press release contains “forward-looking”
statements related to O-I Glass, Inc. ("O-I Glass" or the
"Company") within the meaning of Section 21E of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”) and Section
27A of the Securities Act of 1933. These forward-looking statements
relate to a variety of matters, including, without limitation,
statements regarding the approval, consummation and potential
impact of the Corporate Modernization. Forward-looking statements
reflect the Company’s current expectations and projections about
future events at the time, and thus involve uncertainty and risk.
The words “believe,” “expect,” “anticipate,” “will,” “could,”
“would,” “should,” “may,” “plan,” “estimate,” “intend,” “predict,”
“potential,” “continue,” and the negatives of these words and other
similar expressions generally identify forward-looking
statements.
It is possible that the Company’s future
financial performance may differ from expectations due to a variety
of factors including, but not limited to the following: (1) risks
inherent in, and potentially adverse developments related to, the
Chapter 11 bankruptcy proceeding involving the Company's wholly
owned subsidiary Paddock Enterprises, LLC ("Paddock"), that could
adversely affect the Company and the Company's liquidity or results
of operations, including risks from asbestos-related claimant
representatives asserting claims against the Company and potential
for litigation and payment demands against us by such
representatives and other third parties, (2) the potential impact
of the Corporate Modernization on the Company’s branding and
business, (3) the potential costs of the Corporate Modernization,
(4) the Company’s ability to manage its cost structure, including
its success in implementing restructuring or other plans aimed at
improving the Company’s operating efficiency and working capital
management, achieving cost savings, and remaining well-positioned
to address the Company’s legacy liabilities, (5) the Company’s
ability to acquire or divest businesses, acquire and expand plants,
integrate operations of acquired businesses and achieve expected
benefits from acquisitions, divestitures or expansions, (6) the
Company’s ability to achieve its strategic plan, (7) foreign
currency fluctuations relative to the U.S. dollar, (8) changes in
capital availability or cost, including interest rate fluctuations
and the ability of the Company to refinance debt at favorable
terms, (9) the general political, economic and competitive
conditions in markets and countries where the Company has
operations, including uncertainties related to Brexit, economic and
social conditions, disruptions in the supply chain, competitive
pricing pressures, inflation or deflation, and changes in tax rates
and laws, (10) the Company’s ability to generate sufficient future
cash flows to ensure the Company’s goodwill is not impaired, (11)
consumer preferences for alternative forms of packaging, (12) cost
and availability of raw materials, labor, energy and
transportation, (13) consolidation among competitors and customers,
(14) unanticipated expenditures with respect to data privacy,
environmental, safety and health laws, (15) unanticipated
operational disruptions, including higher capital spending, (16)
the Company’s ability to further develop its sales, marketing and
product development capabilities, (17) the failure of the Company’s
joint venture partners to meet their obligations or commit
additional capital to the joint venture, (18) the ability of the
Company and the third parties on which it relies for information
technology system support to prevent and detect security breaches
related to cybersecurity and data privacy, (19) changes in U.S.
trade policies, and the other risk factors discussed in the
Company’s Annual Report on Form 10-K for the year ended December
31, 2018 and any subsequently filed Quarterly Reports on Form 10-Q
or the Company’s other filings with the Securities and Exchange
Commission.
For further information, please contact:
Chris Manuel Vice President, Investor Relations 567-336-2600
chris.manuel@o-i.com
###
- Paddock Enterprises, LLC Filing Presentation
- Paddock Enterprises, LLC, an O-I Glass, Inc. Affiliate, Seeks a
Final and Equitable Resolution of its Legacy Asbestos-Related
Claims
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