Mounting system maker Schletter’s U.S. company voluntarily filed for Chapter 11 bankruptcy yesterday. The company reports between $10 and $50 million in both liabilities and assets, with debts owed to over 300 creditors.
It is not clear exactly what led to the filing, however there are many possible factors. The recent imposition of tariffs on imported steel and aluminum has put racking, mounting and tracking systems suppliers who manufacture in the United States under pressure, but there are a number of company-specific concerns as well.
Schletter Inc.’s German parent company filed for insolvency in late March, and is currently restructuring. Additionally, Schletter Inc. has been ordered to pay damages under a breach-of-data lawsuit brought by its own employees, after an employee revealed personal data in a “phishing” scam.
Schletter’s largest debtor is Coilplus of North Carolina, with $3.8 million owed. The company also owes $1.2 million to MI Metals, and nearly $900,000 to American Express. Under Chapter 11 U.S. companies can reorganize their business without surrendering their assets.
But before it can continue, Schletter must complete its paperwork. Schletter’s filing for Chapter 11 has been ruled deficient by North Carolina courts, and it must produce substantial additional documentation or its petition will be thrown out.