Replacement Parts Distributor Files for Bankruptcy Protection

by San Antonio Attorney

Valuepart Inc., a company who serves as a distributor for earth-moving equipment, recently filed for bankruptcy protection after plummeting sales.

The company’s legal representatives blamed Valuepart’s bankruptcy due to a sudden decrease of revenue last August. Valuepart is considered to be the largest among the equipment distribution industry in North America. The company has a vast network of warehouses, engine parts and rubber tracks distribution, drive train and hydraulic components distribution, and heavy equipment dealerships.

The lawyers filed for bankruptcy in the Dallas Bankruptcy Court and they had a hard time providing an adequate explanation on the sudden drop of sales. The legal representatives could not be reached for further comment.

ValuePart’s sales have recovered after the temporary drop of revenue. However, the drop of sales broke the borrowing agreement. The access to $35 million became prohibited, thus reducing the maximum amount of the Valuepart’s expenses, according to court documents.

Valuepart’s Chapter 11 bankruptcy filing will give the officials of Valuepart ample time to initiate a negotiation with ACF FinCo I LP. A borrowing deal will be done without halting the company’s operations.

Established in 1995 in Chicago, Valuepart has a total of 70 employees distributed in its headquarters and Dallas warehouses. Other satellite offices are located in Reno, Savannah, Cleveland, Seattle and Canada.

Valuepart distributes heavy equipment replacement parts for international brands.such as Komatsu, Deere and Hitachi.

The company also has a debt of $4.2 million to Skokie Investrade. The lawyers for Valuepart have filed a petition for permission to use the restricted cash.

The lawyers said that without the aid of cash collateral, Valuepart’s operations would have stopped. This would have the consequence of mass layoffs in the company. The officials of Valuepart have hired lawyers from the Gardere Wynne Sewell to aid the company in filing bankruptcy.

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