Friday, March 06, 2009
COUNTRY COACH NOW IN BANKRUPTCY
RV Business
Friday, March 6, 2009
A federal judge ordered Country Coach LLC into Chapter 11 bankruptcy protection on Thursday (March 5), one month after the Junction City, Ore., RV maker’s majority owner filed a petition to put the company into involuntary bankruptcy.
Under court rules, Country Coach had until Wednesday to contest the involuntary filing, but it did not respond. In fact, nothing in the record indicates it retained a bankruptcy attorney.
So U.S. Bankruptcy Judge Albert Rad cliffe granted the request by Bryant Riley to put the company into bankruptcy. A Chapter 11 filing puts the company under the protection of the bankruptcy court while attempting to reorganize its finances.
The judge gave Country Coach three days to provide a list of its 20 largest secured creditors.
Riley, a Los Angeles investment banker, led a group of investors that bought Country Coach in 2007 for $38 million. But one of his companies, Riley Investment Management, also is a creditor of Country Coach’s, and it was in his role as a creditor that he filed the involuntary bankruptcy petition.
Those dual roles — creditor and owner — drew sharp criticism last month by a lawyer for another creditor, Wells Fargo, who said it represented a clear conflict of interest.
Wells Fargo is among Country Coach’s largest creditors. The bank sued Country Coach in January in U.S. District Court in an effort to recover about $8.5 million, but that suit was put on hold after the involuntary bankruptcy filing.
Neither Riley nor his Portland attorney returned phone messages and e-mails seeking comment Thursday. Country Coach officials also did not respond to a request for comment.
Earlier, Radcliffe granted a motion filed by Wells Fargo attorneys to require Riley and top Country Coach executives to submit to questioning by the bank’s lawyers later this month. Topics to be covered include how many finished coaches, works in progress and raw materials are in the company’s inventory, and other questions about Country Coach’s finances.
Country Coach’s factory in Junction City has been shut down since early December, putting about 500 employees out of work. On New Year’s Eve, CEO Jay Howard notified employees that company could close for good by the end of February unless it was able to obtain new financing.
Though a lawyer for Riley said in court last month that a Los Angeles private equity firm was interested in buying and operating Country Coach, no deal has emerged.
Last week, Howard issued a statement saying that company officials were continuing to “work diligently towards a go forward solution” and that he expected to provide “an answer” on the company’s future this week.
Friday, March 6, 2009
A federal judge ordered Country Coach LLC into Chapter 11 bankruptcy protection on Thursday (March 5), one month after the Junction City, Ore., RV maker’s majority owner filed a petition to put the company into involuntary bankruptcy.
Under court rules, Country Coach had until Wednesday to contest the involuntary filing, but it did not respond. In fact, nothing in the record indicates it retained a bankruptcy attorney.
So U.S. Bankruptcy Judge Albert Rad cliffe granted the request by Bryant Riley to put the company into bankruptcy. A Chapter 11 filing puts the company under the protection of the bankruptcy court while attempting to reorganize its finances.
The judge gave Country Coach three days to provide a list of its 20 largest secured creditors.
Riley, a Los Angeles investment banker, led a group of investors that bought Country Coach in 2007 for $38 million. But one of his companies, Riley Investment Management, also is a creditor of Country Coach’s, and it was in his role as a creditor that he filed the involuntary bankruptcy petition.
Those dual roles — creditor and owner — drew sharp criticism last month by a lawyer for another creditor, Wells Fargo, who said it represented a clear conflict of interest.
Wells Fargo is among Country Coach’s largest creditors. The bank sued Country Coach in January in U.S. District Court in an effort to recover about $8.5 million, but that suit was put on hold after the involuntary bankruptcy filing.
Neither Riley nor his Portland attorney returned phone messages and e-mails seeking comment Thursday. Country Coach officials also did not respond to a request for comment.
Earlier, Radcliffe granted a motion filed by Wells Fargo attorneys to require Riley and top Country Coach executives to submit to questioning by the bank’s lawyers later this month. Topics to be covered include how many finished coaches, works in progress and raw materials are in the company’s inventory, and other questions about Country Coach’s finances.
Country Coach’s factory in Junction City has been shut down since early December, putting about 500 employees out of work. On New Year’s Eve, CEO Jay Howard notified employees that company could close for good by the end of February unless it was able to obtain new financing.
Though a lawyer for Riley said in court last month that a Los Angeles private equity firm was interested in buying and operating Country Coach, no deal has emerged.
Last week, Howard issued a statement saying that company officials were continuing to “work diligently towards a go forward solution” and that he expected to provide “an answer” on the company’s future this week.
