Not that this is a news site, but I noticed on the docket that another local auto carrier, Blue Thunder Auto Transport, Inc., and its affiliates, filed Chapter 11 petitions in the Northern District of Georgia (Case No. 07- 61268, filed January 30, 2007). It comes a year and a half after the filings of Allied Holdings, and its affiliates (still in Ch. 11).
A few points from the one pleading I gave a quick glance –
- Debtors provide vehicle transportation services for new and used vehicles, for several manufacturers.
- Debtors have 337 employees, 445 power units and 430 trailer rigs. Debtors have ten terminals.
- Affiliates also filing are Auto Carrier Holding, Inc. (which owns 100% of Blue Thunder Auto Transport), Blue Thunder Logistics, Inc. (the party with the contracts with manufacturers and sub-haulers), Auto Carrier Leasing, Inc. (the owner of the trucks that provide the hauling services). They are seeking joint administration of the cases (but not substantive consolidations).
- According to the Complaint in an adversary, the Ch. 11 cases may have become necessary when a sub-hauler, Penta Auto Transport, Inc. , picked up cars to deliver on behalf of for Blue Thunder and then then put them in storage under its alleged lien rights until Blue Thunder paid the $120,000 owed to Penta for past due hauling services.
It’ll be interesting to see if this filing further affects the markets (hauling, and auto maker) and whether Blue Thunder will have the same union issues as Allied.
The press release from the company –
Subject: Blue Thunder Files for Bankruptcy Protection under Chapter 11
As a result of reduced volumes system wide during the fourth quarter of 2006, Blue Thunder experienced cash flow difficulties that caused us to fall behind in some of our payments to vendors and sub haulers.
In an effort to aggressively address our cash flow issues, Blue Thunder’s Board hired Aurora Management Partners, Inc. as its restructuring advisor. They are assisting senior management in stabilizing our operations, managing our daily cash activity, and repairing our relationships with key vendors thereby regaining the confidence of our senior lender.
Concurrently Blue Thunder’s Board engaged Morgan Keegan, an investment banker, to seek out a partner through sale or merger that would be capable of carrying on its business as the new foundation is set. There are several candidates who’ve expressed an interest in a transaction that will move our business forward.
The recovery plan was beginning to demonstrate positive results when an unforeseen and unfortunate event took place. A key sub-haul vender, with whom we’d been negotiating in good faith to reduce our past due account payable, balance seized three loads of our customer’s vehicles and refused to release them. Repeated efforts to obtain the release of the vehicles through legal intermediaries were met with silence.
Without a clear path to resolving this situation, we had to make an unpleasant but practical choice to file for relief under Chapter 11 in order to free the vehicles and enable the company to work fairly and comprehensively with all of our employees, customers and vendors. Filing for Chapter 11 protection under these circumstances allows Blue Thunder time to organize and re-energize its operations while continuing to provide reliable transportation service to our customers, sustain gainful employment for our employees and offer payment to our suppliers in a fair and orderly manner. A sale or merger will continue to be considered as a key element of our restructuring plan to be reviewed during our protection period.
We will continue to operate as a going concern which means we will continue to service our contracts, pay our employees and pay our post bankruptcy bills for ongoing operations while we get our house in order.
Most important to each of you we will continue to meet all of our payroll obligations and maintain our current benefit structure throughout this restructuring process.
We appreciate your patience and look for your continued support as we vigorously move through this process to emerge a stronger and more capable transportation organization.
I am available to discuss any questions or concerns you may have.
Steve Worman, President
Blue Thunder Auto Transport