Jason Industries Inc., Milwaukee, Wisconsin, (Nasdaq:JASN) (Nasdaq:JASNW), parent company to a global family of manufacturers in the seating, finishing, automotive acoustics and components markets, on Wednesday filed for Chapter 11 bankruptcy protection in the Southern District of New York.
The bankruptcy filing, coupled with a deleveraging of its balance sheet by $250 million, were due to “disruptions brought on by the COVID-19 global pandemic,” according to the company’s CEO, Brian Kobylinski.
Jason Industries announced it would pursue bankruptcy protection in a June 5 press release.
The move follows a previously announced restructuring plan that, once completed, will deleverage the company’s balance sheet by $250 million. The company expects its day-to-day operations to continue without interruption and without disruption to its employees, customers, suppliers and vendors.
Jason previously entered into a restructuring support agreement with holders of approximately 87 percent of its first lien debt that, pursuant to the terms of the agreement, will ultimately deliver the company’s balance sheet by $250 million.
Under the bankruptcy filing, the company is seeking court approval to:
- Honor all customer programs;
- Continue employee wages and benefits without interruption; and
- Pay for goods and services provided to the company.
“We have aggressively taken steps to simplify Jason and improve the performance and financial strength of our company over the past three years,” Kobylinski said. “While these actions have generated positive momentum, we were not able to realize the full benefits of our plans due to market cyclicality and disruptions brought on by the COVID-19 global pandemic.
“Directly addressing our balance sheet will enable Jason and its operating businesses, Osborn and Milsco, to build upon our improved operational foundation and reap the benefits of recent cost-reductions and new business wins. We thank our lenders, employees, customers and suppliers for their continued support throughout our process. We will emerge an even stronger company with the opportunity to realize its full potential.”