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Breaking News Of Importance To The HHG Industry
Dear HHG and Relocation Professionals:
 

In our continuing efforts to bring you the latest information pertaining to the Moving and Storage Industry, we have reprinted herein the following News Release from Reuters:
 

 Allied Van Lines parent bankrupt in housing crunch

Tue Feb 05 12:40:36 UTC 2008

 

NEW YORK, Feb 5 (Reuters) - Sirva Inc <SIRV.PK>, the provider of moving services and parent of Allied Van Lines, filed for bankruptcy protection on Tuesday after struggling with too much debt in the U.S. housing downturn.

The Westmont, Illinois-based company and close to 60 affiliates filed for protection in the U.S. bankruptcy court in Manhattan. It has $924.5 million of assets, $1.23 billion of debt, and more than 100,000 creditors, according to the filing. Sirva said the bankruptcy covers only its U.S. operations.

Sirva sought court protection "to free up its operations from a heavy debt service burden and to strengthen its balance sheet so that it is better positioned to weather the continuing weak housing market."

On Nov. 9, Sirva said a write-down, a loss om home sales, and carrying costs and losses from taking more homes into inventory contributed to a $10.4 million third-quarter loss. Revenue totaled $1.17 billion.

"We wish we could do something about the U.S. real estate market, but we can't," Chief Executive Robert Tieken said at the time.

Sirva said it agreed with lenders to restructure its senior secured debt in a prepackaged bankruptcy. It expects to stay in business while it restructures, and emerge from bankruptcy within 60 to 90 days with $200 million less bank debt and $54 million lower annual interest costs.

The company's largest shareholders include private equity firms Clayton, Dubilier & Rice, which owns more than 31 percent of the shares, and ValueAct Capital Partners LP, which owns more than 20 percent, the filing shows.

Sirva said it has lined up $150 million of financing to keep operating, and that this will convert into a $215 million senior secured credit facility once it emerges.

Sirva conducts more than 300,000 relocations per year, and handles such services as moving, home purchases and sales, and home closings and settlements.

Shares of Sirva closed Monday at 12.5 cents. They traded as high as $4.48 last Feb. 22. (Reporting by Jonathan Stempel; Editing by Derek Caney)

 
 
 
 
Sincerely,
 

Mark Gray
Movers Search Group
(678)373.3634