GST Seton Autoleather supplier files for relief under Chapter 11

Oct 6, 2017   Tier Suppliers

GST AutoLeather, Inc. announced on October 4 that it has filed a voluntary petition for relief under chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware.

The Company has obtained a commitment from its senior secured lenders for a $40 million debtor-in-possession facility, the proceeds of which will be used to fund ongoing business operations. This facility will allow GST to continue business as usual during the reorganisation process, while pursuing a court-supervised going concern sale, commonly referred to as a "363 Sale".

Chief Executive Officer Dennis Hiller said, "After working with our advisors to review a range of strategic alternatives, the proposed strategy represents the best solution to ensure continuity of supply to our customers, maximise value for all stakeholders and position the Company for long-term success." Mr. Hiller went on to say, "I would especially like to thank our customers, suppliers, employees and Senior Lenders for supporting us through this time as we work to improve our capital structure and enhance value."

The Company and its Senior Lenders are negotiating the terms of an acquisition of the Company by its Senior Lenders. This would serve as a backstop in the "363 Sale" and will pave the path for the Company to exit chapter 11 and maintain the business as a going concern.

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