Formica Exits Chapter 11
June 10 2004 - 5:35PM
PR Newswire (US)
Formica Exits Chapter 11 Emerges With Strengthened Balance Sheet;
Debt Reduced by $370 Million CINCINNATI, June 10 /PRNewswire/ --
Formica Corporation announced today that it has completed the
necessary steps to implement its Plan of Reorganization and has
successfully emerged from Chapter 11. "This achievement is
attributable to the confidence that our sponsors have in our
company and our future, the loyalty of our customers, the
professionalism and dedication of our employees, the commitment and
support of our creditor groups, and the recognition of the strength
of the Formica(R) brand and its reputation for quality, durability
and industry leading innovation," said Frank A. Riddick, III,
President and Chief Executive Officer of Formica. "We accomplished
what we set out to do at the outset of our Chapter 11
restructuring. We have substantially decreased our long-term debt,
while we streamlined and improved our service and operations. With
the Chapter 11 process behind us, we can now increase our focus on
what continues to be our top priority -- providing our global
customers with a portfolio of design coordinated, branded surfacing
solutions and products," said Riddick. Formica exits Chapter 11
with a strengthened balance sheet, including consolidated debt of
approximately $160 million in long term financing, down from more
than $540 million in debt at the time of the filing in March 2002,
lower interest expense and improved efficiencies arising from the
consolidation of manufacturing and warehousing facilities. "We are
grateful for the support of our lenders and the confidence they
have displayed in Formica as we emerge from Chapter 11," Riddick
stated. In conjunction with emergence, Formica has entered into an
amended Term Loan Facility for $135 million with its existing
secured lenders. General Electric Capital Corporation is the Term
Loan Agent. Formica said that it had also closed on a $65 million
revolving credit facility. Wells Fargo Foothill, Inc. is the
Revolving Credit Agent. "This exit financing will provide the
Company with sufficient liquidity to continue to meet our financial
requirements and grow our business globally," said Riddick. As part
of the Plan of Reorganization, a group of investors led by Cerberus
Capital Management L.P. and Oaktree Capital Management LLC have
purchased the common shares of the Successor Company for $175
million in cash. Substantially all of these proceeds will be used
to repay existing secured lenders. Management will hold options to
purchase approximately 10% of the common shares. About Formica
Formica Corporation was founded in 1913, and is the preeminent
worldwide manufacturer and marketer of decorative surfacing
materials, including high-pressure laminate and solid surfacing
materials. Formica has sales operations in approximately 100
countries. Additional information about the company is available on
Formica's Web site at http://www.formica.com/ DATASOURCE: Formica
Corporation CONTACT: Jeff Lloyd or Steven Goldberg, both of Sitrick
And Company Inc., +1-212-573-6100, for Formica Corporation Web
site: http://www.formica.com/
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