Newton Manufacturing Files Chapter 11, Agrees to Sell to HALO Branded Solutions
Yesterday, Newton Manufacturing, Newton, Iowa, petitioned the U.S. Federal Court in Des Moines, Iowa for Chapter 11 Bankruptcy protection. Although subject to potential competitive bidding, the filing included a court motion to sell nearly all of the assets of the business to industry distributor, HALO Branded Solutions, Sterling, Ill., in an expedited sale to take place within 30 days.
“We have explored several options to resolve the difficult financial environment we have operated under for several months," Mancil Laidig, Newton Manufacturing president, said. "It became clear that our greatest assets, the Newton sales force and the loyal team that supports them, would be best served with a Chapter 11 filing.
“HALO bought out the position of our senior, secured lender and has agreed to provide Debtor-in-possession (DIP) financing, which was a crucial first step in a successful transition of the business," added Laidig. "This financing will assure all Newton orders that are shipped and billed from today forward will be paid in the normal course of business. The confidence this will provide our suppliers in filling our orders will have an immediate and positive impact on our ability to serve the Newton sales force and their customers.”
HALO Branded Solutions, a perennial Top 50 Distributor and No. 5 on this year's list, has recently added several other distributorships to its business. Its sales were up more than 10 percent from 2014 to 2015.
"For over a century, Newton has been known for a loyal sales force and talented support team," Terry McGuire, senior vice president of marketing at HALO Branded Solutions, said. "We look forward to eventually serving their sales force and, based on the revenue we retain, providing opportunities for several members of their support team.
"In the process, we will be working with suppliers we share with Newton to provide the best recovery possible for Newton's pre-filing debt," McGuire added.
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