(Reuters) – Tire maker GPX International Tire Corp said on Tuesday its U.S. operations filed for Chapter 11 protection as a result of 44 percent antidumping duties levied by the U.S. Commerce Department against its manufacturing facility in China.
GPX, which specializes in making tires for off-road use, said it would use the restructuring process to split its operations into three parts and sell them separately.
Under the restructuring plan, Alliance Tire Corp will acquire GPX’s U.S. operations, including worldwide rights to the Galaxy and Primex brands, the company’s medium radial truck tire distribution business and the company’s South African entity, GPX Tyre South Africa.
The company will wind down its European operations, while its Canadian unit, Dynamic Tire Corp, will become a separate entity.
The bankruptcy filing applies only to GPX and not to its foreign subsidiaries including Canada’s Dynamic Tire and China’s Starbright Group Inc, the company said.
In a bankruptcy petition filed late on Monday, the company said it had both assets and liabilities of between $100 million and $500 million.
Malden, Massachusetts-based GPX said that although some job eliminations may arise from redundancies in corporate functions, the restructuring will allow 95 percent of its current North American workforce to remain employed.
A list of creditors holding the largest unsecured claims includes U.S. Customs and Border Protection, which is owed $5.7 million, and China’s Tianjin United Tire and Rubber, which is owed $1.8 million, according to the bankruptcy petition.
The case is In re: GPX International Tire Corp, US Bankruptcy Court, District of Massachusettes (Boston), No. 09-20170. (Reporting by Santosh Nadgir in Bangalore; Editing by Mike Miller)
peHUB Note: Sterling Investment Partners had acquired a minority equity stake in GPX four years ago for just over $40 million.