Privately-held Ameriforge Group (d/b/a AFGlobal) and 19 affiliated Debtors filed for Chapter 11 protection with the U.S. Bankruptcy Court in the Southern District of Texas, lead case number 17-32660. The Company, which provides technology, services and fully-integrated manufacturing capabilities to the oil and gas, general industrial, aerospace and power generation industries, is represented by Patricia B. Tomasco Jackson Walker.
According to documents filed with the Court, “The difficulties faced by the Company are consistent with those impacting the oil and gas industry more broadly. Beginning in 2014 and continuing through 2016, the oil and gas market experienced a significant oversupply of capacity leading to a substantial and rapid decline in oil prices. This in turn resulted in significantly lower activity by the Company’s customers, manifesting into lower revenues and losses. Lower steel prices and declining international demand for industrial products also resulted in lower activity from the Company’s distributors. This prolonged downturn in commodity prices only exacerbated the Company’s legacy capital structure, which was intended to support a much larger company before the Company began streamlining their business with strategic divestitures.”
Concurrent with the Chapter 11 petition, Ameriforge Group also filed with the Court a Joint Prepackaged Chapter 11 Plan of Reorganization & related Disclosure Statement. If consummated, the Plan will (i) significantly de-leverage the Debtors’ balance sheet; (ii) provide the Debtors with working capital to fund ongoing operations during the Chapter 11 cases and post-emergence; (iii) distribute new common stock and warrants to the holders of first lien claims and second lien claims, as applicable; (iv) allow holders of general unsecured claims to remain unimpaired and (v) maximize recoveries for all key stakeholders. Ameriforge Group lists total assets of $580 million.
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