Packaging: Atlantis liquidates molding, film businesses

One day after filing for Chapter 11 bankruptcy protection, Atlantis Plastics Inc. (Atlanta, GA) announced plans to liquidate its business, selling its plastics film extrusion unit to AEP Industries Inc. and its molded plastics division to a subsidiary of New York-based private equity fund Monomoy Capital Partners L.P. The company hopes to close the sales in October, but, because of the bankruptcy filing, it will have to listen to higher offers for the businesses. The company said that a $26.5 million credit line provided by a consortium of lenders led by GE Business Financial Services Inc. will allow it to maintain normal business operations.

Atlantis processes polyethylene stretch and custom films, as well as molded and extruded plastics for applications in the appliance, automotive, agricultural, building supply, and recreational vehicle industries. The injection molding group has more than 200 presses ranging from 44 to 1000 tons spread among six facilities in the Midwest and South Central States, including Henderson, KY; LaVergne, TN; Jackson, TN; and Alamo, TX. The profile extrusion unit operates two facilities in Elkhart, IN and claims to be one of the largest extruders of custom plastic profiles in the U.S. The Linear Films business, which offers stretch-film products, has more than 200 million lb of manufacturing capacity at three U.S. manufacturing sites. The Custom Films business produces mono and multilayer polyolefin films down to 0.475 mil, with sheeting, tubing, bags-on-roll, and perforated sheeting out to 129 inches wide.

The company has recently been in the news following a shooting at its Henderson, KY operation on June 25. On Jan. 23, Atlantis hired Houlihan, Lokey, Howard & Zukin to review strategic alternatives, and on March 7, it voluntarily delisted its shares from the electronic stock exchange NASDAQ. On July 31 of last year, the company warned its lenders that it was in default for certain financial covenants under its secured credit facility.—[email protected]