Transtar Completes Restructuring, Emerges From Chapter 11

Transtar Completes Restructuring, Emerges From Chapter 11

Financial reorganization eliminated $300 million of debt and provides $74 million in new financing.

 

 

Transtar Holding Co., a distributor and manufacturer of aftermarket automotive products, today announced that it has emerged from Chapter 11 after successfully completing its plan of reorganization, confirmed by the United States Bankruptcy Court for the Southern District of New York.

The plan significantly improves Transtar’s financial position, de-leveraging the balance sheet by nearly $300 million. The first lien term loan, which was originally issued at $420 million is being reduced to $200 million and the entire $170 million second lien debt facility is being retired. In addition, the company has entered into a new senior secured credit facility of $74 million, which will pay off the debtor-in-possession financing and provide additional liquidity for Transtar to remain a highly competitive player in the industry.

“The company’s new, much stronger capital structure provides the flexibility we need to pursue our growth objectives, and positions Transtar for long-term success,” said Edward Orzetti, CEO of Transtar. “In addition, we are extremely pleased that the plan we put forward will allow us to pay in full all creditors who continue to do business with Transtar. Maintaining this priority throughout the process clearly demonstrates how much we value our suppliers and business partners.”

“The board has confidence in Transtar management and the go-forward plan for the business, and is excited about the company’s future,” said Timothy Lavelle, member of the Transtar board of directors.

“I want to sincerely thank Transtar’s suppliers, business partners and our customers for their patience and collaboration through this process,” added Orzetti. “Most of all, I want to thank our associates for their hard work, dedication and perseverance. We could not have achieved this without them, and I know they will continue to drive our success as we enter this new stage of Transtar’s journey.”

Jones Day LLP served as legal counsel, Ducera Partners served as investment banker and FTI Consulting Inc. served as restructuring adviser to Transtar.

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