Court OKs Key Items in Ahern’s Chapter 11 Reorganization Company expects no interruption of operations.
The U.S. Bankruptcy Court in Nevada has approved key items in Ahern Rentals, Inc.'s voluntary petition for Chapter 11 reorganization. CEO Don Ahern says the company expects no interruption in its operations during the restructuring.
Ahern Rentals, a leader in the equipment rental industry, is headquartered in Las Vegas, Nev. It operates 74 branches in 22 states and has about 1,800 employees.
On Thursday, Dec. 22, Ahern filed a voluntary petition for Chapter 11 reorganization in the United States Bankruptcy Court for the District of Nevada in Reno, Nev., because it was unable to extend the maturity of its revolving credit, which had a maturity date of Aug. 21, 2011. Since the maturity, the bank has continued to fund the company and negotiate extension of revolving credit without a bankruptcy filing.
The company says that although its financial performance continues to improve, it has been forced to seek bankruptcy protection to address the maturity of its revolving credit, even though about 90 percent of its lenders would have agreed to an extension.
Ahern has reached an agreement with existing lenders for Debtor-in-Possession (“DIP”) financing with approximately $50 million of availability. On Friday, Dec. 23, 2011, the bankruptcy court approved key items in Ahern's reorganization plan.
The company says it intends to continue its business operations throughout the administration of Chapter 11 restructuring and to honor all of its existing customer, vendor, and employee commitments. During the reorganization, the company will use the DIP financing to meet its working capital needs.
“We anticipate there being no interruption to our operations. With our DIP Facility, we will have sufficient liquidity to meet our commitments to our customers, vendors, and employees,” said Don Ahern, CEO.
He added that “We have been experiencing a significant improvement in our business, with a substantial increase in our utilization levels and improved margins. It is business as usual, and we anticipate no impact to our customers, vendors, and employees.”
More information about the court documents is available at www.kccllc.net/ahern.