Contec Holdings Ltd., a cable-box repair company which is owned by Bain Capital, filed for Chapter 11 reorganization Thursday, according to Reuters.
The bankruptcy filing list the company’s assets at $100 million with their debts reaching as much as $500 million, according to Bloomberg News.
Chief operating officer, Wes Hoffman said in statement, “This reorganization process will allow Contec to invest in and enhance our capabilities to serve our cable industry customers.”
Bain acquired Contec Holdings in 2008 from American Capital limited, who said at the time that they earned $120 million for their two year investment into the company.
In their statement, Contec said they reached an agreement with their senior creditors and would be able to emerge from bankruptcy within the next six months.
“No jobs are expected to be impacted by this reorganization process, and we believe Contec will emerge from the process in an even stronger position to grow our business,” Wes Hoffman said.
Bain Capital is a private equity firm once ran by Republican Presidential nominee Mitt Romney, who left in 1999 to manage the 2000 Salt Lake City Winter Olympics. Romney’s contenders in the primaries used his experience at Bain to disqualify him for the nomination, an attack that is being echoed by the Democratic Party.
Contec repairs millions of cable boxes, modems and satellite receivers on an annual basis. They have repair plants in Schenectady, Seattle, Mexico City and Matamoros, Mexico, which opened in 2009.
Chapter 11 is a bankruptcy structure favored by businesses because it allows them to continue operations while they work on paying off their creditors, generally for a smaller amount than is owed. Savvy bankruptcy attorneys can draft reorganization plans that will only not allow the troubled business to reduce their debts but emerge a healthier company.
