Owens Corning Files Voluntary Chapter 11
Owens Corning, Toledo, Ohio, announced that, in order to address the growing demands on its cash flow resulting from its multibillion dollar asbestos liability, the company has voluntarily filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code. The filing will enable Owens Corning to refocus on operating its business and serving its customers, while it develops a plan of reorganization that will resolve its asbestos and other liabilities and provide a suitable capital structure for long-term growth.
Owens Corning also announced that, in order to enhance its liquidity, it has obtained a $500 million debtor-in-possession financing commitment from Bank of America. Upon court approval, these funds will be available to the company to help meet its future needs and fulfill obligations associated with operating its business, including payment under normal terms to suppliers and vendors for all goods and services that are provided after the filing.
Glen H. Hiner, chairman and chief executive officer of Owens Corning, said, “Owens Corning today is a sound company, with over $5 billion in annual revenues and leadership positions in all of its businesses. All of our operations are open today and focused on serving our customers. The combination of our cash on hand, existing cash flow and a new $500 million financing commitment provides the company sufficient liquidity to meet all future financial obligations to employees, suppliers and vendors.”
In a conversation with Roofing Contractor, Owens Corning reaffirmed its commitment to its customers and contractors. “We are open for business,” says Gregg Bronk, vice president, corporate communications. “Customer service is hard at work and our plants are operating. All warranties and guarantees will be fully honored. Going forward, we are confident that we will be a stronger company than ever before.” Bronk emphasized that Owens Corning products are top rate and business is strong; the company’s difficulties were caused by the asbestos liability. “Contractors can rest assured that we are in business today and we will be in business tomorrow. We appreciate their continued support.”