Mossi Ghisolfi Group, a global supplier of polyester resins, feedstocks, fibers and biofuels, has filed for bankruptcy protection in its home nation of Italy.
M&G on Oct. 17 officially filed for the arrangement with creditors procedure — known in Italy as "concordato preventivo" — to ensure equal treatment of creditors, according to a posting on the firm's website.
The companies "are studying a proposal" for an arrangement that will allow their overall activities to continue as a going concern, officials said in the posting, although they cannot exclude "alternative solutions."
Tortona-based M&G's struggles include an inability to finance a massive PET resin project — known as Project Jumbo — in Corpus Christi, Texas. Numerous contractors working at the site have said that they have not been paid. Construction contractor Fluor Enterprises laid off almost 300 workers at the site in September.
M&G also owes $49 million to Mexican conglomerate Alpek SAB de CV for supplies of PET feedstock purified terephthalic acid (PTA). In September, Alpek announced that it was stopping shipments of a PET feedstock to two plants operated by M&G in Mexico and Brazil as a result of the debt.
According to published reports, M&G has stopped PET production at its 1.2 billion-pound capacity plant in Altamira, Mexico. The firm also had filed notice with local officials that it would stop production at its PET plant in Apple Grove, W.Va., which has annual production capacity of almost 800 million pounds.
Alpek made the unusual move of announcing the stopped shipments and the unpaid debt in a news release. In the same release, Alpek officials added that the firm "anticipates difficulties" for M&G to complete the massive PET project in Corpus Christi.
Alpek, which also owns North American PET maker DAK Americas, had agreed to distribute more than 1 billion pounds of PET made at the new M&G unit. In its third quarter financial filing, Alpek said it had $643 million of asset impairment exposure from M&G, as well as a $223 million tax credit.
"Volume, revenues and EBITDA were negatively impacted in [the third quarter of 2017] by the current M&G shutdown," Alpek officials wrote in the report. "Alpek has limited visibility at this time to provide a reliable 4Q17 outlook."
In mid-September, a spokesman for M&G said in an email to Plastics News that the firm "is in active dialogue with its key stakeholders regarding its near-term needs." Earlier this year, M&G officials said that problems with a former construction contractor at the Corpus Christi plant would not stop the facility from opening on time, later this year.
Alpek has annual sales of almost $5 billion, employing more than 5,000 at 23 plants making resins, chemicals, feedstocks and fibers throughout North and South America. Its DAK business unit is based in Charlotte, N.C.
M&G ranks as one of North America's largest PET makers, with a North American headquarters in Houston.
