LAGUNA HILLS, CA (BRAIN)—True Temper Sports Inc. has filed for Chapter 11 bankruptcy protection, largely because of a downturn in the golf equipment industry.
The company, best known for making golf club shafts, also serves the bicycle industry with tubing, forks and seatposts.
In a filing with the U.S. Bankruptcy Court for the District of Delaware, True Temper listed estimated assets of about $180.5 million and estimated liabilities of about $319 million.
The company said last week it had reached an agreement with secured lenders, bondholders and shareholders to restructure all of its outstanding debt and would file a "pre-packaged" restructuring petition.
This filing is merely a mechanism to implement the agreed upon balance sheet restructuring, and will not impact the fundamental business of True Temper or its day-to-day operations, according to the company. In addition, this pre-packaged filing will be made with all the necessary support from True Temper’s lenders, and will have no impact on the company’s trade creditors, such as vendors and suppliers. The company’s management team, its board of directors, and its lenders elected to enact this process as the most efficient and expeditious way to affect the agreed upon financial plan.
“This is a very important day for our company, as we have successfully reached an agreement to restructure our balance sheet and significantly lower our debt profile," said president and chief executive officer Scott Hennessy. "This new financial template clearly allows for the acceleration of our global expansion plans, and for the continued growth of the True Temper business as the overall economy improves.
"I am pleased that we were able to work so closely with our current lenders and investors to reach an agreement that is beneficial for the company in both the short and long term. I am encouraged that the plan was able to come together in a way that ensures our employees, customers, suppliers and underlying operations remain unaffected by this balance sheet only restructuring. As we have said many times during the past several months, True Temper has a very compelling and successful business, but clearly there were capital structure issues that needed to be addressed. We have now addressed these concerns, and will be much better positioned for our continued success.”
