Force Ten Partners completed a restructuring effort for CarbonLite Holdings and its subsidiaries, one of the world’s largest suppliers of post-consumer recycled polyethylene terephthalate (rPET), which is then used to produce high-quality food-grade recycled rPET material sold to the world’s largest beverage companies. On March 8, 2021, CarbonLite filed a voluntary Chapter 11 bankruptcy to maximize the asset values of its four manufacturing facilities. The restructuring efforts were led by Force 10 co-founder Brian Weiss who served as the Chief Restructuring Officer.
Force 10 was initially retained during Q4/20 to navigate underperformance, operational challenges and solvency issues surrounding its complicated capital structure consisting of approximately $380 million of indebtedness, including $250 million of secured indebtedness across three publicly traded municipal bonds, a term loan, an ABL facility and multiple capital lease obligations.
Force 10 led CarbonLite’s restructuring efforts and evaluated multiple strategies to maximize value, including Section 363 asset sales, recapitalization and insolvency strategies. During the case, the Force 10 team secured $80 million in new money debtor-in-possession financing to ensure business operations and in-process construction projects.
Under Weiss’ direction, the debtors conducted a complex four-part asset sale to individual purchasers for CarbonLite’s manufacturing facilities. These sales resulted in approximately $230 million in transaction value, including $63.9 million for the company’s assets in Dallas to Indorama Ventures Holdings LP, $98.1 million in Reading, PA to DAK Americas LLC, $57.4 million in Riverside, CA and the CarbonLite IP to TSG Shelf II Acquisition, and $9.6 million for Pinnpack Packaging LLC in Oxnard, CA to Pinnpack Capital Holdings. In addition, the asset sales substantially preserved all of CarbonLite’s non-executive jobs.
“Through this process, CarbonLite’s mission to decrease the amount of PET plastic that ends up in landfills will continue,” Weiss said. “The plant purchasers will carry on CarbonLite’s mission, resulting in more than 300 million tons of plastic bottles being converted into recycled materials each year.”