Superior TeleCom Inc. has received approval from the U.S. Bankruptcy Court for the company's "first day" motions that will help ensure its operations proceed smoothly and uninterrupted throughout its reorganization proceeding.
"The court's approval of our first day motions will ensure that Superior TeleCom can conduct business as usual and remain focused on serving our customers as we go through this process," says David Aldridge, chief financial officer of Superior TeleCom.
The court approved interim access to the $100 million debtor-in-possession financing facility for use by the company.
The court also approved motions related to paying claims of essential trade creditors, paying shipping charges, import/export obligations, sales and use taxes and maintaining the company's consolidated cash management system. It also authorized payment of pre-petition employee obligations and continuation of customer programs.
On March 3, the wire and cable manufacturer announced its intention to implement a reorganization of its capital structure that will reduce debt and interest cost and provide enhanced financial flexibility for the company. To facilitate the restructuring, the company and its U.S. subsidiaries have filed a voluntary petition for reorganization under Chapter 11 of the United States Bankruptcy Code.
Chairman Steven Elbaum says the company's decision to implement a major restructuring and deleveraging of its balance sheet was made in consultation with its principal secured lenders. This followed a series of credit agreement amendments obtained by the company which allowed it to improve its competitiveness.
"However, the sustained downturn in the telecom markets, particularly in the sharply reduced demand from our traditional local telephone company customers for communications cable products in the local loop, and continued lack of a visibly strong economic recovery have caused the company to conclude that seeking further credit agreement amendments would not be productive," says Elbaum.
Superior TeleCom is based in East Rutherford, N.J. For more information visit
www.superioressex.com.
