Atrium Cos. Inc., a major fabricator of vinyl windows and doors, has filed for Chapter 11 protection as part of a pre-negotiated financial restructuring.
The Dallas company said more than two-thirds of its senior secured lenders have agreed to a plan to reduce Atrium's debt by more than 50 percent, or more than $350 million.
President and CEO Gregory Faherty said restructuring should be complete in three to four months and will put Atrium in a much stronger financial position.
We have already done the hard work of lowering our cost structure and reducing excess capacity in light of the difficult environment under which we have been operating for more than three years. And, we are already experiencing the positive impact of these initiatives through increased profitability, Faherty said in a Jan. 20 news release.
Atrium has downsized in recent months, including closing fabrication plants in Jacksonville, Fla., and Tolleson, Ariz.
Now ... we will put in place a healthier capital structure that is more appropriate to the current size of the market, while freeing up additional cash that can be invested in future growth as the housing market rebounds.
The company filed its voluntary Chapter 11 petitions in U.S. Bankruptcy Court in Wilmington, Del., and the firm's Canadian unit filed in Ontario Superior Court of Justice in Toronto.
The plan includes a new equity investment of $125 million from the company's majority equity owner, New York investment firm Kenner & Co. Inc., and its co-investor, Golden Gate Capital.
Atrium and each of its subsidiaries plan to operate as usual, and it does not plan any layoffs or plant closings, officials said.
Atrium makes vinyl and aluminum building products, and has three vinyl profile extrusion plants. Plastics News estimated the company generated $40 million in vinyl extrusion-related sales in 2008.
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