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[January 2002]
RHI Refractories Holding Company Restructuring to Realign Core Businesses
RHI Refractories Holding Company (Pittsburgh, PA, USA) has announced a major restructuring plan. It says that the restructuring will reduce debt, increase manufacturing efficiency and realign the company's core businesses: Harbison Walker Refractories Company, AP Green Industries and North American Refractories Company (NARCO).These business units produce high-grade ceramic refractories. The companies provide products and services for high temperature applications in the iron and steel, cement and lime, non-ferrous metals, glass, environmental technology, energy and chemicals industries.
"The continuing financial crisis in the US steel industry has sharply reduced demand for refractory products," said Guenter Karhut, the CEO of RHI Refractories Holding Company. "As a result, we are restructuring our core businesses to be as competitive as possible and to build a stronger foundation for future success in key markets."
As part of the restructuring, NARCO, like other entities facing an overwhelming number of asbestos-related claims, filed on 4 January 2002 a voluntary petition for reorganisation under Chapter 11 of the United States Bankruptcy Code. The petition was filed in the US Bankruptcy Court for the Western District of Pennsylvania, in Pittsburgh. NARCO is seeking court approval of a US$20 million debtor in possession financing facility, which NARCO believes will provide adequate capital to meet its ongoing obligations to its customers, vendors and employees.
"In the case of NARCO, it is our hope that it will emerge after Chapter 11 reorganization as a financially stable company with improved prospects for future success," said Karhut. "We are working closely with creditors to implement a court-approved business plan that will accomplish this goal."
RHI emphasised that the NARCO reorganisation petition does not affect Harbison Walker or AP Green Industries, which are viable businesses that are less dependent on steel industry customers.
RHI has 24 manufacturing facilities and 2,400 employees in the USA and Canada. The company said that it will close some facilities in the restructuring process to reduce production capacity and redundancies, but the number and locations haven't been determined. The company expects to announce more specific details in the near future.
ENDS