A massive logistics company now files for bankruptcy in California as it plans to liquidate after listing up to $10 million in liabilities.
Freight forwarder company Boateng Logistics has joined a growing list of shipping companies that have permanently shuttered their businesses as the firm on February 22 filed for Chapter 7 bankruptcy with plans to liquidate.
The Carlsbad, California logistics company filed its petition in the U.S. Bankruptcy Court for the Southern District of California listing assets up to $50,000 and $1 million to $10 million in liabilities.
Court papers said it owed millions of dollars in liabilities to trucking, logistics and factoring companies, FreightWaves originally reported.
The company filed bankruptcy before any creditors could take legal action.
Boateng’s largest unsecured creditor is the U.S. Small Business Administration, owed on a $750,000 loan.
Other unsecured creditors include factoring firms Five Star Factoring, eCapital Freight Factoring Co. and Triumph Business Capital.
The bankruptcy court will hold a meeting of creditors on March 28.
Freight forwarding companies typically manage the details of moving products from one location to another, arranging where products can be loaded on a ship, plane or truck and transported to a warehouse for fulfillment and distribution.
However, a freight forwarding company does not manage trucks, drivers or port workers.
What they do best is negotiate better rates directly with carriers to get better shipping prices than eCommerce companies can secure on their own, according to ShipHero.
They can also can coordinate shipments on multiple types of transportation for land, sea and air, and have a deep understanding of customs, imports and exports for handling overseas shipments.
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Also Read: A US Company Now Declares An Unexpected Bankruptcy
Other Economy News Today
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
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