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Pemco World Air
Services Enters Chapter 11 By Shane Nolan |
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March 6, 2012 - Pemco World Air Services (the “Company”
or “Pemco”), a leader in Maintenance, Repair and
Overhaul (MRO) and Conversion Services, announced on
Monday that it has filed a voluntary petition under
Chapter 11 of the U.S. Bankruptcy Code in the Bankruptcy
Court for the district of Delaware. The Company expects
to quickly restructure and emerge as a stronger and more
viable business.
The process will allow Pemco to improve its cost and
capital structure, essentially positioning the Company
more competitively in the marketplace and allowing it to
continue to provide outstanding service to its
customers. During the restructuring, the Company will
continue to operate in the normal course of business,
without interruption. |
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To that
end, Pemco has secured a debtor-in-possession (DIP) financing
from Avion Services Holdings, LLC, an affiliate of Sun Capital
Partners. The DIP financing will provide the Company with
sufficient working capital to continue to meet its ongoing
obligations and payments to employees and suppliers throughout
the process.
Pemco
anticipates that its operations will emerge from bankruptcy
within the next 90 days. To meet this accelerated timeline,
Pemco will utilize Section 363 of the United States Bankruptcy
Code and filed today with the Court a purchase agreement entered
into with one of its current lenders, Avion Services Holdings,
LLC. The Company is also commencing a marketing process to
determine if there are other interested parties.
“Pemco’s
operations have been impacted in recent years by a number of
conditions, including a slowdown in the number and magnitude of
MROs, a decrease in airplane conversions in Dothan, and the
overall impact of the economic downturn,” said William Meehan,
Chief Executive Officer of Pemco.
“While we
have taken steps to address the challenges, we believe this
process is the most effective and efficient way to restructure
our business. We are pleased with the support we have received
from Avion Services and look forward to expeditiously moving
through the restructuring process and quickly emerging with a
revised capital structure that will allow us to remain the
industry leader.”
The
Company also announced that it is reviewing its options at its
Dothan, AL, facility and anticipates a decision will be made
shortly regarding the potential for a prompt closure of the
facility.
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