A big appliance company now files an unexpected bankruptcy after racking up a whopping $832 million in debt, sources report.
Appliance component manufacturer Robertshaw U.S. Holdings filed for Chapter 11 bankruptcy protection on Thursday, seeking to cut $670 million in debt and resolve litigation between its lenders, reports Reuters.
Robertshaw manufactures more than 10,000 sophisticated controls for commercial and home appliances, per its website.
Primary applications include controls for clothes washers and dryers, dishwashers, refrigerators, electric and gas cooking, ice makers, fluid dispensing, storage water heaters, gas valves for space/central heating, and automotive/off road temperature and fluid controls.
The company, owned by private equity firm One Rock Capital Partners, entered bankruptcy with a restructuring agreement supported by a majority of its lenders, according to documents filed in Houston, Texas bankruptcy court.
The company will also explore a bankruptcy sale as an alternative to its debt restructuring.
“Robertshaw may not be a household name, but its products appear in almost every household,” attorney George Klidonas said at a Thursday court hearing in Houston.
The company blames the pandemic for its struggles.
Robertshaw said it was unable to sustain its high debt level in the face of rising interest rates and lingering supply chain challenges that arose during the COVID-19 pandemic.
The Itasca, Illinois-based company said it has $832 million in debt.
In the last nine months of 2023, Robertshaw generated a gross profit of $58.8 million.
The company’s efforts to address its debt outside of bankruptcy spurred litigation between its lenders in 2023.
Robertshaw will seek to resolve that dispute in bankruptcy, either through mediation or litigation in bankruptcy court, according to court documents.
The company has lined up a $56 million bankruptcy loan funded by its majority lender group, according to court filings, and will seek bankruptcy court approval for that loan at a later date.
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Also Read: This Massive Restaurant Is Now Closing 41 Locations
Other Economy News Today
A bankrupt department store now has a massive liquidation sale up to 70% as it prepares to close its final location in New Jersey.
Sears is closing its final location in New Jersey on Sunday, March 3, reports The-Sun.
The iconic department store chain will soon have just 11 mainland US stores left, the outlet reports.
Situated in Jersey City’s Newport Mall, the closing location is the only Sears store serving New York City residents.
The closest remaining Sears for NYC shoppers will be 227 miles away in Braintree, Massachusetts.
Sears has served as the anchor store for Newport Mall since it opened in 1987.
Rumors have it that Primark, the Irish discount clothing and home store, could take its spot, as per CNN.
Sears announced the closure of its Newport mall store via Facebook.
In a post, it told shoppers that “everything” would be between 25% and 75% off.
Sears and K-Mart are both owned by Transformco.
They have been on a rapid decline since their peak in 2005, at which point they had a combined 3,500 stores.
Under the ownership of billionaire Eddie Lampert, sales have dramatically slowed as Sears has failed to keep up with competitors in the online space.
By 2018, Transformco filed for bankruptcy.
Although the retailer survived bankruptcy with 223 Sears stores in tact, all but 11 in the continental US and one in Puerto Rico have since closed.
Sears is not the only mall staple struggling to survive.
JCPenney is also holding liquidation sales at its anchor store at the Crystal Mall in Waterford, Connecticut.
Since filing for bankruptcy in 2021, it has closed a total of 175 locations.
However, the retailer has vowed to spend $1 billion remodeling its existing stores by the end of 2025 to stop shoppers from turning away.
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Also Read: A US Company Now Declares An Unexpected Bankruptcy
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