M&G Group Companies in Bankruptcy Filing
Within a day of each other, Europe and US-headquartered companies belonging to the Tortona, Italy-based M&G Group filed for protection from creditors. The PET specialist, traditionally known as Mossi & Ghisolfi, has been beset by financial problems, due not least to investing in new polymerization plants just as the market was beginning to overheat.
Last year, M&G Finanziaria, the holding owned by the Ghisolfi family, saw its operating profit fall 90% to €6.9 million on sales revenues of €1.7 billion. The company reported an overall net loss of €92 million.
Affected by the European filing in the insolvency court of Alessandria, Italy, are the holding, production companies M&G Polimeri, Biochemtex, Beta Renewables, Italian Bio Products and IBP Energia as well as the real estate branch Acetati Immobiliare. In the US, M&G Polymers USA has entered Chapter 11 proceedings.
In a statement published on its website, M&G said its group companies are “studying a proposal for an arrangement that will allow their overall activities to continue as a going concern, although they cannot exclude alternative solutions at the end of the ongoing technical assessments.”
Concurrent with the filings, the Italian group halted production at all of its worldwide PET plants, and suspended construction of a much-delayed facility at Corpus Christi, Texas. An unexpected overrun of costs for this plant, designed to have capacity for 1.1m t/y of PET and 1.3m t/y of polyester feedstock PTA, is said to have been the straw that broke the camel’s back as regards the Italian producer’s financial viability. The 2015 death of managing director Guido Ghisolfi, rumored to be a suicide, had already dealt a massive blow.
The US subsidiary told the US Bankruptcy Court Delaware District it has assets worth between $500 million and $1 billion, along with liabilities of $100-500 million. Among its largest unsecured creditors are three other PET industry players, Indorama Ventures, to whom it owes $57 million, Shell Chemical ($2 million) and Eastman Chemical, $ 1.2 million. respectively. Feedstock supplier Alpek said it is owed for unpaid feedstock deliveries to the M&G plant at Altamira, Mexico.
Along with the plant closures, M&G is said to be considering a sale of its biofuels activities, to free up funds.
