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TPI Composites, Inc. (NASDAQ:TPIC) announced Monday that it and certain subsidiaries filed voluntary petitions for relief under Chapter 11 bankruptcy in the United States Bankruptcy Court for the Southern District of Texas. The filing comes as no surprise to InvestingPro subscribers, who have observed the company’s WEAK Financial Health Score of 1.02 and deteriorating balance sheet. The company stated the filing was made to facilitate a financial and operational restructuring.
According to a press release statement, TPI Composites will continue to operate its business as a "debtor-in-possession" under court supervision. With total debt of $731.73 million and a concerning current ratio of 0.36, the company has secured a debtor-in-possession (DIP) financing agreement with Oaktree Fund Administration, LLC and other lenders, providing up to $82.5 million in new financing. Get deeper insights into TPI’s financial health with a comprehensive Pro Research Report, available exclusively on InvestingPro. The DIP facility includes an initial $7.5 million available upon interim court approval, up to $20 million upon final approval, and the ability to roll up to $55 million of existing senior secured term loans into the facility. The DIP facility matures nine months from the bankruptcy filing date, with interest accruing at SOFR plus 9% per annum, payable in kind.
The bankruptcy filing triggered events of default under TPI Composites’ existing credit agreements and its 5.25% Convertible Senior Unsecured Notes, accelerating obligations of approximately $471.8 million and $135.3 million, respectively, as of the petition date. Payment enforcement on these debts is automatically stayed under bankruptcy law.
Additionally, the company reported that defaults under its unsecured credit facilities in Türkiye have resulted in restricted access to cash held in Turkish bank accounts, with outstanding obligations of approximately €71.2 million. TPI Composites expects these debts to be addressed through a liquidation of its Turkish assets.
On Tuesday, TPI Composites received notice from the Nasdaq Stock Market that its common stock will be delisted due to the bankruptcy filing. The company does not intend to appeal the determination. Trading of TPI Composites’ common stock will be suspended at the opening of business on August 19, 2025, and a Form 25-NSE will be filed with the Securities and Exchange Commission to remove the stock from listing and registration on Nasdaq. The company expects its shares to begin trading on the over-the-counter (OTC) market.
All information is based on a statement provided in the company’s recent SEC filing.
In other recent news, TPI Composites has filed for Chapter 11 bankruptcy protection, initiating proceedings in the U.S. Bankruptcy Court for the Southern District of Texas. The company has secured a debtor-in-possession financing facility of up to $82.5 million, arranged with senior secured lenders associated with Oaktree Capital Management. This financing includes $27.5 million in new funds and $55 million from the existing senior secured credit facility, pending final documentation and court approval. Meanwhile, Jefferies has adjusted its price target for TPI Composites from $0.50 to $0.70, while maintaining an Underperform rating, citing anticipated production disruptions in Mexico and Turkey. TD Cowen has downgraded TPI Composites from Buy to Hold, lowering its price target to $1.00 from $2.00, due to concerns about the company’s debt and lack of a clear deleveraging strategy. These developments highlight ongoing financial and operational challenges for TPI Composites.
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