Business Capital Arranges DIP for Pacific Steel Casting
Business Capital has secured an $8.5 Million DIP loan for Pacific Steel Casting, an independent steel casting company that makes carbon, low-alloy and stainless steel castings for US and international customers, largely for heavy-duty trucks and construction equipment.
PSC recently filed for Chapter 11 bankruptcy protection to enable it to restructure its liabilities and remain in operation. Binder & Malter, a law firm specializing in bankruptcy for over 25 years, is representing PSC through the chapter 11 filing process.
Business Capital was referred in by Pacific Steel’s prior lender to arrange new financing. “We are so pleased to have secured this credit facility for Pacific Steel,” said Chuck Doyle, managing director of business capital. “This company’s long-time employees, suppliers and customers are their number one concern and this new financing will ensure a seamless transition into the next phase of Pacific Steel Casting’s opportunities. We were able to understand and present the merits of the company’s situation (reorganization or sale of the company) which was critical in getting the immediate working capital needed to support ongoing operations and maintain vendor and customer confidence during the Chapter 11 proceedings.”
After a government audit forced the company to layoff nearly 200 undocumented workers and pay heavy fines, PSC struggled to replace workers while incurring higher workers compensation insurance premiums and significant additional costs associated with settling an employee class-action lawsuit related to the timing of lunch breaks. The Company continues to operate in its Berkeley location.
“Pacific Steel remains open for business,” said chief operating officer Chuck Bridges. “Acquiring this funding will allow the company to continue to serve its customers, preserve jobs and give us some runway to restructure and move forward on stronger footing.”
Previously on abfjournal: Siena Completes DIP Facility for Pacific Steel Casting, April 16, 2014