BY Fraser Tennant
Amid “industry-wide pressures”, US wind turbine blade maker TPI Composites, along with its domestic subsidiaries, has filed for Chapter 11 bankruptcy protection to pursue a comprehensive restructuring.
To allow it to emerge as a stronger enterprise, TPI has reached an agreement, subject to final documentation and approval of the Bankruptcy Court, with its senior secured lenders comprised of funds affiliated with funds managed by Oaktree Capital Management.
The agreement will see Oaktree provide a debtor-in-possession financing facility which is expected to be comprised of up to $27.5m in new money to support TPI’s day to day operations and up to $55m rolled up from the company’s existing senior secured credit facility.
“Industry-wide pressures have created financial challenges that must be addressed,” said Bill Siwek, chief executive of TPI. “We have explored a variety of alternatives to address the challenges we face and believe that a Chapter 11 process is necessary to position the company for success.”
In conjunction with the Chapter 11 proceedings, TPI has filed a number of customary motions with the Bankruptcy Court seeking court authorisation to support its operations, including the payment of employee wages, salaries and benefits.
TPI anticipates receiving court approval for these requests and intends to continue honouring its obligations to key stakeholders post filing, including by satisfying payment obligations to suppliers for goods and services provided in accordance with customary terms after the filing.
“We aim to reach agreement with stakeholders on the terms of a plan of reorganisation for the company to be able to right-size its balance sheet and go forward with the ability to compete successfully in the current economic environment,” continued Mr Siwek. “Doing so will provide access to new liquidity to continue our operations and invest in innovation, ensuring our customers can continue to count on TPI for leading-edge wind blade solutions.”
Focused on innovative and sustainable solutions to decarbonise and electrify the world, TPI operates factories in the US, Mexico, Turkey and India, with additional engineering development centres in Denmark and Germany and global service training centres in the US and Spain.
TPI does not expect any material operational impact from the Chapter 11 proceedings and will continue to operate its manufacturing sites to deliver blade services.
Mr Siwek concluded: “I am grateful to our associates for their dedication in continuing to deliver outstanding service, and to our customers, suppliers, service providers and other stakeholders for their steadfast support during this restructuring.”
News: Oaktree to take over wind blade maker TPI after bankruptcy