Transtar Holding Co., a distributor and manufacturer of aftermarket automotive products, has entered into a Restructuring Support Agreement (RSA) outlining the terms of a balance sheet restructuring that will strengthen the company’s financial position by reducing long-term debt and enhancing liquidity. The key terms of the RSA include a debt reduction of approximately $290 million and approximately $74 million in new financing.
Transtar says the RSA is being supported by holders owning more than 98.8 percent of the company’s first lien debt and the company’s equity sponsor. Following the restructuring, current holders of first lien debt will be the new equity owners of the company.
To facilitate these important changes to Transtar’s capital structure, Transtar commenced a Chapter 11 proceeding in the U.S. Bankruptcy Court for the Southern District of New York to implement a “pre-packaged” plan of reorganization through a brief, court-supervised restructuring process.
“Transtar will operate as usual, and our team remains committed to continuing to provide responsive service to our customers. It will be business as usual for us,” said Edward Orzetti, CEO of Transtar Holding Co. “The actions we are announcing today represent an important and positive step forward in our efforts to strengthen Transtar’s financial position. We will emerge from this restructuring as a stronger company with a more flexible capital structure. This will enable us to pursue our strategic growth plans as we make continued progress in enhancing our operations.”
Willkie Farr & Gallagher LLP is serving as legal counsel, Ducera Partners is serving as investment banker and FTI Consulting, Inc. is serving as restructuring adviser to Transtar.
