WAYNE, PA — Trinseo PLC (OTCM: TSEOF) has filed for Chapter 11 bankruptcy protection in the United States as part of a pre-packaged restructuring agreement that will eliminate approximately $2 billion of debt and reduce annual interest expenses by about $140 million.
The specialty materials manufacturer commenced voluntary Chapter 11 proceedings in the U.S. Bankruptcy Court for the Southern District of Texas with the support of lenders holding a majority of its senior secured debt, the company said.
The filing marks a significant step in Trinseo’s effort to repair its balance sheet after years of financial pressure across the chemicals and specialty materials sectors. The company expects to complete the court-supervised restructuring on an expedited basis and emerge with a substantially lower debt burden.
Under the restructuring support agreement previously negotiated with creditors, existing lenders are expected to receive nearly all of the equity in the reorganized company.
Trinseo said operations will continue without interruption during the bankruptcy process. The Chapter 11 cases are limited to certain U.S. subsidiaries and select non-operating affiliates outside the United States, while other company affiliates are not included in the proceedings.
“We will significantly improve our balance sheet and financial flexibility while continuing to manufacture products, serve our customers, drive innovation and uphold our commitments to suppliers and vendors,” Chief Executive Officer Frank Bozich said.
The restructuring will be supported by approximately $158 million in debtor-in-possession financing, along with exit financing that will take effect when the company emerges from bankruptcy.
The company also secured a new $150 million non-recourse revolving credit facility backed by trade receivables, replacing an existing facility of the same size.
Trinseo said holders of general unsecured claims, including trade creditors, vendors, and suppliers, are expected to remain unimpaired under the restructuring plan.
As part of the bankruptcy process, the company has filed motions seeking court approval to continue paying suppliers for goods and services provided after the filing date and to maintain employee compensation and benefits programs. Trinseo said the restructuring agreement does not require concessions from employees, customers, vendors, or suppliers.
The company manufactures specialty material solutions for customers across a range of industrial and consumer end markets worldwide.
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