Trinseo, a specialty material solutions provider, has struck a sweeping deal with its major lenders aimed at dramatically restructuring its capital structure and stabilizing its finances.
The company announced it has entered into a Restructuring Support Agreement (the “RSA”) with parties holding a majority of its debt. The binding agreement is designed to “significantly reduce Trinseo’s debt obligations, strengthen its balance sheet and improve its long-term financial health.”
Importantly, “No concessions from employees, customers, vendors, or suppliers are part of this agreement.”
The move marks a decisive step toward a court-supervised financial overhaul.
Trinseo says the plan will position it to “execute its long-term growth strategy and operate from a positive free cash flow position,” following “collaborative discussions with key lenders to restructure Trinseo's capital structure on an expedited basis while preserving the Company's market-leading position as a specialty material solutions provider.”
Company CEO Frank Bozich framed the agreement as a pivotal reset. “Since our founding, Trinseo has partnered with organizations to bring ideas to life through smart, sustainable material solutions—combining deep expertise, innovation and best-in-class materials,” he said.
“With the support of our lenders, this agreement marks an important step forward to strengthen our balance sheet so we can continue to operate our business uninterrupted, drive innovation, support growth and manufacture the products that our customers rely on for decades to come.
"We’re confident that entering into this agreement will position us well for the future and we look forward to emerging from this process as a stronger organization, well-equipped to meet the needs of our partners around the world. We are deeply grateful to our employees for their continued dedication and hard work, and to our customers and partners for their support.”
Under the restructuring, Trinseo will cut roughly $2.0 billion in debt and reduce annual interest expense by about $140 million. The plan includes a pre-packaged Chapter 11 filing supported by “a fully committed ~$158 million debtor-in-possession financing, a $150 million accounts receivable facility, as well as exit financing.”
Existing lenders are set to receive “100% of the reorganized Company’s equity,” while “all holders of general unsecured claims, including trade creditors, vendors, and suppliers, will be unimpaired.”
The company plans to file voluntary Chapter 11 petitions in the US Bankruptcy Court for the Southern District of Texas in the coming weeks, with an expedited exit expected.
Despite the restructuring, Trinseo says operations will continue without disruption globally. The company intends to seek court approval for motions ensuring continued payments to vendors, suppliers, employees, and customers, stressing that ordinary business operations will not be impacted during the process.
