Latest news with #MarelliHoldings
Yahoo
18-07-2025
- Business
- Yahoo
Blame it on tariffs: CEOs roll out new excuse for bankruptcies
(Bloomberg) — When At Home Group Inc.'s lawyer stood before a US bankruptcy judge last month asking to wipe out nearly $2 billion of the retailer's debt, the reason came quick: tariffs. It's a line that's showing up in more and more courtrooms. Tile importer Mosaic Cos. blamed them in a recent filing. Just weeks earlier, it was auto-parts supplier Marelli Holdings Co. and aluminum trader Sinobec Group Inc. In all, tariffs have been laid out as a key reason in at least 10 bankruptcies in the US since early April, when President Donald Trump first unveiled a new wave of levies, according to data compiled by Bloomberg. But to many economists and analysts, the tariff blame game doesn't hold up — at least not yet. For one, it's simply too early for the latest duties to have made a material impact on corporate performance, especially for companies that typically carry several months' worth of inventory, they say. What's more, recent data showing solid employment growth, rising wages and a persistently low jobless rate signal that the economy is still holding up. It's the latest chapter in a well-worn corporate bankruptcy playbook, where companies pin their collapse on everything from fickle consumers to currency swings — even bad weather — anything but their own missteps. While market watchers say tariffs could eventually push a number of struggling firms over the edge, right now they're seen more as an excuse to paint over deeper problems. 'Companies are struggling, but the tariffs did not put them into bankruptcy,' said Stephanie Roth, chief economist at Wolfe Research. 'Until the labor market starts to crack in a real negative way, there's no great reason to believe that consumers should pull back or that the economy is weakening sufficiently.' Take At Home, which sells everything from patio furniture to rugs to generic wall decor. Its woes began well before Trump's latest round of tariffs. Burdened with a high debt load following its 2021 takeover by private equity firm Hellman & Friedman, the impact of the Covid-19 pandemic on supply chains led to rising costs for material and labor. As consumers shifted to spending more on travel and leisure, waning demand for home goods also dented performance, leading to credit-rating downgrades and a distressed exchange in 2023. Last month, the Texas-based company said it will close at least 26 of its more than 250 stores as part of its bankruptcy. At its Rego Park location in Queens, New York — one that it plans to shutter — customers who braved the summer heat in search of bargains were lamenting its demise. 'I am a little sad to see this one go because it's just so much easier to get something that fits your style,' said Diana Delacruz, 22, who was browsing items at the store's going-out-of-business sale. A representative for At Home declined to comment. Marelli, the auto-parts supplier, for its part, said in a court filing that it was 'severely affected' by headwinds driven by auto tariffs rolled out by the Trump administration in March. But the company, which provides lighting systems and suspensions to the likes of Stellantis NV and Nissan Motor Co., was already contending with industry upheaval as electrification and automation forced carmakers to shift their strategy to cope with declining sales in key markets. 'The market pressures impacting the entire automotive industry and lower production volumes we began seeing a year ago, long before current tariffs were put in place, were the main issues that constrained our working capital,' Fernando Vivanco, Marelli's chief communications officer, said in an emailed response to questions. Sunnova Struggles Some companies have said that tariffs are just one of a number reasons they've struggled. In its June filing, Sunnova Energy International Inc. said cuts to government subsidies, inflation and higher interest rates were curbing demand for their equipment — while mentioning that the latest tariffs were another hurdle. Prominent names in the sector including SunPower Corp., Lumio, and Meyer Burger Technology AG's US operations have also filed for bankruptcy over the past year. A representative for Sunnova declined to comment beyond the bankruptcy filing. Market watchers say that depending on how current Trump administration negotiations play out, tariffs could ultimately play a much larger role in bankruptcies in the months ahead. Recent economic indicators — consumer spending, retail sales, US factory activity — already show a dent in demand amid the policy uncertainty. The number of companies at the greatest risk of defaulting are at an 11-month high, Moody's Ratings said in a report earlier this week So far, however, the overall damage to companies has been contained. S&P Global Ratings said earlier this month that only 31 credit grade cuts in recent months have been tied to tariffs, less than 1% of its total ratings actions. For now, some say that if plans for a restructuring were already in the works, Trump's levies may have just served as motivation to file for bankruptcy sooner. Some of these 'smell of the private capital people who are adept at using the bankruptcy laws to facilitate a restructure of a business that they want to keep but has an unsustainable debt burden,' said Todd Baker, a senior fellow at the Richmond Center for Business, Law, and Public Policy at Columbia University. —With assistance from Steven Church. ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
18-07-2025
- Business
- Yahoo
Blame It on Tariffs: CEOs Roll Out New Excuse for Bankruptcies
(Bloomberg) -- When At Home Group Inc.'s lawyer stood before a US bankruptcy judge last month asking to wipe out nearly $2 billion of the retailer's debt, the reason came quick: tariffs. The Dutch Intersection Is Coming to Save Your Life Advocates Fear US Agents Are Using 'Wellness Checks' on Children as a Prelude to Arrests Mumbai Facelift Is Inspired by 200-Year-Old New York Blueprint LA Homelessness Drops for Second Year Manhattan, Chicago Murder Rates Drop in 2025, Officials Say It's a line that's showing up in more and more courtrooms. Tile importer Mosaic Cos. blamed them in a recent filing. Just weeks earlier, it was auto-parts supplier Marelli Holdings Co. and aluminum trader Sinobec Group Inc. In all, tariffs have been laid out as a key reason in at least 10 bankruptcies in the US since early April, when President Donald Trump first unveiled a new wave of levies, according to data compiled by Bloomberg. But to many economists and analysts, the tariff blame game doesn't hold up — at least not yet. For one, it's simply too early for the latest duties to have made a material impact on corporate performance, especially for companies that typically carry several months' worth of inventory, they say. What's more, recent data showing solid employment growth, rising wages and a persistently low jobless rate signal that the economy is still holding up. It's the latest chapter in a well-worn corporate bankruptcy playbook, where companies pin their collapse on everything from fickle consumers to currency swings — even bad weather — anything but their own missteps. While market watchers say tariffs could eventually push a number of struggling firms over the edge, right now they're seen more as an excuse to paint over deeper problems. 'Companies are struggling, but the tariffs did not put them into bankruptcy,' said Stephanie Roth, chief economist at Wolfe Research. 'Until the labor market starts to crack in a real negative way, there's no great reason to believe that consumers should pull back or that the economy is weakening sufficiently.' Take At Home, which sells everything from patio furniture to rugs to generic wall decor. Its woes began well before Trump's latest round of tariffs. Burdened with a high debt load following its 2021 takeover by private equity firm Hellman & Friedman, the impact of the Covid-19 pandemic on supply chains led to rising costs for material and labor. As consumers shifted to spending more on travel and leisure, waning demand for home goods also dented performance, leading to credit-rating downgrades and a distressed exchange in 2023. Last month, the Texas-based company said it will close at least 26 of its more than 250 stores as part of its bankruptcy. At its Rego Park location in Queens, New York — one that it plans to shutter — customers who braved the summer heat in search of bargains were lamenting its demise. 'I am a little sad to see this one go because it's just so much easier to get something that fits your style,' said Diana Delacruz, 22, who was browsing items at the store's going-out-of-business sale. A representative for At Home declined to comment. For more on corporate distress and bankruptcies, subscribe to The Brink Marelli, the auto-parts supplier, for its part, said in a court filing that it was 'severely affected' by headwinds driven by auto tariffs rolled out by the Trump administration in March. But the company, which provides lighting systems and suspensions to the likes of Stellantis NV and Nissan Motor Co., was already contending with industry upheaval as electrification and automation forced carmakers to shift their strategy to cope with declining sales in key markets. 'The market pressures impacting the entire automotive industry and lower production volumes we began seeing a year ago, long before current tariffs were put in place, were the main issues that constrained our working capital,' Fernando Vivanco, Marelli's chief communications officer, said in an emailed response to questions. Sunnova Struggles Some companies have said that tariffs are just one of a number reasons they've struggled. In its June filing, Sunnova Energy International Inc. said cuts to government subsidies, inflation and higher interest rates were curbing demand for their equipment — while mentioning that the latest tariffs were another hurdle. Prominent names in the sector including SunPower Corp., Lumio, and Meyer Burger Technology AG's US operations have also filed for bankruptcy over the past year. A representative for Sunnova declined to comment beyond the bankruptcy filing. Market watchers say that depending on how current Trump administration negotiations play out, tariffs could ultimately play a much larger role in bankruptcies in the months ahead. Recent economic indicators — consumer spending, retail sales, US factory activity — already show a dent in demand amid the policy uncertainty. The number of companies at the greatest risk of defaulting are at an 11-month high, Moody's Ratings said in a report earlier this week So far, however, the overall damage to companies has been contained. S&P Global Ratings said earlier this month that only 31 credit grade cuts in recent months have been tied to tariffs, less than 1% of its total ratings actions. For now, some say that if plans for a restructuring were already in the works, Trump's levies may have just served as motivation to file for bankruptcy sooner. Some of these 'smell of the private capital people who are adept at using the bankruptcy laws to facilitate a restructure of a business that they want to keep but has an unsustainable debt burden,' said Todd Baker, a senior fellow at the Richmond Center for Business, Law, and Public Policy at Columbia University. --With assistance from Steven Church. What the Tough Job Market for New College Grads Says About the Economy How Starbucks' CEO Plans to Tame the Rush-Hour Free-for-All Godzilla Conquered Japan. Now Its Owner Plots a Global Takeover A Rebel Army Is Building a Rare-Earth Empire on China's Border Why Access to Running Water Is a Luxury in Wealthy US Cities ©2025 Bloomberg L.P. Sign in to access your portfolio
Bloomberg
18-07-2025
- Business
- Bloomberg
Blame It on Tariffs: CEOs Roll Out New Excuse for Bankruptcies
When At Home Group Inc. 's lawyer stood before a US bankruptcy judge last month asking to wipe out nearly $2 billion of the retailer's debt, the reason came quick: tariffs. It's a line that's showing up in more and more courtrooms. Tile importer Mosaic Cos. blamed them in a recent filing. Just weeks earlier, it was auto-parts supplier Marelli Holdings Co. and aluminum trader Sinobec Group Inc. In all, tariffs have been laid out as a key reason in at least 10 bankruptcies in the US since early April, when President Donald Trump first unveiled a new wave of levies, according to data compiled by Bloomberg.
Yahoo
14-06-2025
- Automotive
- Yahoo
Marelli receives US court approval to access finance and continue operations
Marelli Holdings has said it has secured court approval – as part of its US Chapter 11 bankruptcy proceedings – for a measure that it says secures 'all-normal course business operations continuing as usual'. The company has announced that it has received approvals from the US Bankruptcy Court for the District of Delaware for its 'First Day' motions related to the company's voluntary Chapter 11 petitions. The court granted interim approval to immediately access up to $519 million of $1.1 billion in debtor-in-possession financing from its lenders. Marelli said the additional capital, coupled with cash generated from the company's ongoing operations, will provide 'sufficient liquidity to support the company through the Chapter 11 process. Among other things, the court has authorized the company to continue to pay employee wages and benefits without interruption, continue programs that are integral to customer relationships and pay suppliers in full for goods and services provided on or after the filing date of June 11, 2025. 'We are pleased to have received Court approval of these important First Day motions, which will enable Marelli to continue serving our customers without interruption throughout the chapter 11 process,' said David Slump, President and Chief Executive Officer of Marelli. 'Thanks to the partnership with our lenders, we are poised to emerge from this process not just stronger, but strategically equipped for sustainable growth and innovative advancements. We extend our heartfelt gratitude to our customers and suppliers for their loyalty and commitment.' "Marelli receives US court approval to access finance and continue operations" was originally created and published by Just Auto, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Sign in to access your portfolio
Yahoo
11-06-2025
- Automotive
- Yahoo
Marelli initiates Chapter 11 bankruptcy to restructure debt
Marelli Holdings, a technology partner in the automotive industry, has filed for voluntary Chapter 11 proceedings in the US Bankruptcy Court for the District of Delaware. This strategic move is aimed at restructuring the company's long-term debt obligations. The filing has garnered the support of approximately 80% of Marelli's lenders, who have signed a restructuring support agreement to deleverage the company's balance sheet and enhance its liquidity. Marelli president and CEO David Slump said: "At Marelli, we have been proactive in making necessary adjustments to stabilize our financial position so that we can continue to deliver long-term benefits for our valued customers, partners and employees. While we are pleased with our recent progress and profitability, industry-wide market pressures have created a gap in working capital that must be addressed." Throughout the Chapter 11 process, Marelli anticipates no operational disruptions, maintaining its commitment to innovation and investment in advanced automotive technologies. These efforts are expected to shape the future of mobility and distinguish upcoming vehicle models. To facilitate its restructuring, Marelli has secured $1.1bn in debtor-in-possession financing from its lenders. Subject to court approval, this financing, along with the company's operational revenue, will provide the necessary liquidity for Marelli during the Chapter 11 process. The restructuring support agreement also outlines a plan for the lenders to assume ownership of Marelli upon its emergence from Chapter 11, following a 45-day overbid process. Marelli has filed customary motions to ensure business continuity during the restructuring, which includes uninterrupted payment of employee wages and maintenance of essential customer programs. The company expects to receive court approval for these motions and plans to uphold its commitments to stakeholders, including fulfilling payment obligations to suppliers for post-filing goods and services. Marelli is actively engaging with suppliers to negotiate terms for pre-filing obligations. Slump added: "After careful review of the Company's strategic alternatives, we have determined that entering the chapter 11 process is the best path to strengthen Marelli's balance sheet by converting debt to equity, while ensuring we continue operating as usual. "Taking this action now provides access to new liquidity to fund our long-term growth and innovation pipeline and ensures our customers and partners all over the world can continue to rely on Marelli for on-time delivery of advanced technologies that shape the vehicles of the future." "Marelli initiates Chapter 11 bankruptcy to restructure debt" was originally created and published by Just Auto, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
