Media, Pennsylvania - US foam giant Foamex International Inc. has signed an agreement to sell substantially all of its assets to an affiliate of MatlinPatterson Global Opportunities Partners III LP, the company announced 25 March.
Foamex, reputed to be the biggest polyurethane foam group in North America, recently went into Chapter 11 bankruptcy protection for the second time in four years, citing the difficult economic climate and the group's substantial debt burden - more than $380 million -- as contributing factors.
MatlinPatterson, along with Bank of America, was funding Media-headquartered Foamex's $95 million borrowing as a debtor in possession.
According to Foamex, MatlinPatterson will purchase Foamex's assets as a going concern, assuming the group's ongoing obligations to customers and vendors, and offering continued employment to workers.
The sale depends on approval of the Bankruptcy Court, and on other offers which may be made at an auction to be held in May, 2009, Foamex added.
Following approval of the sale, "Foamex businesses will emerge from chapter 11 as a stable and competitive private company with a much stronger balance sheet," said Jack Johnson, president and chief executive officer, in the statement.
Johnson said Foamex will emerge with "a capital structure more suited to today's challenging business environment."
Foamex calls itself the "world's leading producer" of polyurethane foam and speciality comfort products, serving markets in bedding, furniture, carpet cushion and automotive, as well as making high-performance technical foam for other uses in industry, aerospace, defence, electronics and the computer sector.
• Separately the company has launched a new website at www.foamex.com. "Our products literally surround consumers in their everyday lives, and we wanted the new website to reflect that," said Alvaro Vaselli, senior vice president, Foam Products Business Management.
"In a very visual way, the website illustrates our solutions-oriented approach and provides insight into our key technologies. The intent is to engage visitors from the markets and industries we serve so they'll initiate conversations with us about their business and product needs," Vaselli said.