Liberty Fibers Corporation Files For Protection Under Chapter 11 Of The U.S. Bankruptcy Code In Greeneville, Tennessee
Friday, September 30, 2005Barker said that the increased competition over the past six months in the global rayon fiber market, resulted in a sharp increase in imports of rayon fiber from Asia and Europe into the North American market. The resulting loss of sales to its largest customers, in addition to the decline in sales margins, made it impossible for Liberty to cover its operating costs. In the weeks ahead, Liberty will be evaluating different strategic options for the business based on the forecasted future of the rayon fiber market in North America.
Lowland, Tennessee – Craig Barker, President of Liberty Fibers Corporation, stated that late yesterday, Liberty filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy Code the U.S. Bankruptcy Court in Greeneville, Tennessee. He further stated that an interim order was entered today that secured post-petition financing with its senior lender, LaSalle Business Credit, to provide financing for the next 4 weeks. Liberty has since ceased all activities related to the rayon fiber production. The employees have been informed that they have been laid off for an indefinite period, except for a small staff that will be retained to conduct clean up, sell the remaining inventories, secure the fixed assets and monitor the environmental operations on the site.