Chapter 11 Filed By Battery Maker
Battery maker, Exide, manufacturer of car and truck batteries
, has filed for Chapter 11 bankruptcy protection as it seeks to repair its financial woes.
The company has obtained a $500 million financing package from JPMorgan Chase that should keep it operating normally until the details of the restructuring are finalized. Availability of product is not expected to be impacted.
Exide cited the price of scrap lead in North America, which accounts for 40 percent of its costs of goods sold as a major reason for its troubles.
It has also been battling intensely for market share against its primary rival, Johnson Controls, which managed to steal away one of Exide’s major accounts: Wal-Mart.
Additionally, the trouble-struck company was recently ordered to suspend lead recycling in California by that state’s Department of Toxic Substances Control board for failing to comply with state regulations.
They have also been having problems in the European market, which accounts for more than 51 percent of its revenue.
Exide’s shares have fallen 92 percent in the last 12 months, closing on Friday at 20 cents apiece.
