Atrium out of bankruptcy with Golden Gate, Kenner equity contribution

By Caroline Salls

Pittsburgh, April 30 - Atrium Cos., Inc.'s recapitalization closed on Friday with Golden Gate Capital and Kenner & Co. contributing more than $170 million of equity capital, according to a news release.

As a result of its restructuring, Atrium has reduced its pre-bankruptcy debt by almost 60%.

"Atrium has emerged from this process as a stronger company with far less debt," president and chief executive officer Gregory T. Faherty said in the release.

"With a healthy balance sheet and new financing, we are very excited about the opportunities that lie ahead.

"Golden Gate Capital and Kenner & Company are experienced building products investors and well-capitalized partners, and we look forward to working with them to help the company flourish."

As previously reported, Atrium's plan of reorganization was confirmed on April 28 by the U.S. Bankruptcy Court for the District of Delaware. The plan took effect on Friday, according to a court filing.

Under the plan, majority equity owner Kenner & Co. and co-investor Golden Gate Private Equity Inc. will make a $169.2 million equity investment in exchange for 92.5% of the reorganized company's new common stock.

The reorganized company will also obtain up to $320 million in new secured loans.

Atrium said the equity investment and new debt obligations will be applied under the amended plan to satisfy 95% of senior secured claims in cash. Holders of these claims will also receive a share of $7.5 million in cash.

As part of a global settlement, holders of senior subordinated claims will receive a total of 7.5% of the new common stock under the new value plan, with two-thirds going to holders of 11% senior subordinated notes and one-third going to holders of 15% senior subordinated notes.

Creditor treatment

Creditor treatment will include:

• Kenner and Golden Gate will make a $169.2 million new equity investment in exchange for 92.5% of the new common stock in the reorganized company;

• The company's senior secured debt will be refinanced;

• Holders of 11% senior subordinated notes claims will receive a share of 7.5% of the new common stock;

• Holders of ACIH note claims will recover 2% of their claims in cash, up to a maximum of $90,000;

• Holders of unsecured trade claims will be paid in full in cash after execution of a vendor support agreement;

• Holders of general unsecured claims of Atrium Corp., general unsecured claims of ACIH, section 510(b) claims and interests in Atrium Corp. will receive no distribution;

• Intercompany claims will be either reinstated, canceled or discharged, and holders will receive no distribution; and

• Intercompany interests will be reinstated.

Atrium, a Dallas-based manufacturer of vinyl and aluminum windows and patio doors, filed for bankruptcy on Jan. 21. The Chapter 11 case number is 10-10150.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.