Ascend files for Chapter 11 to deliver “stronger” future

BY Fraser Tennant

In a move designed to strengthen its balance sheet and improve its financial foundation, chemical manufacturing company Ascend Performance Materials, along with 10 of its affiliates, has filed for Chapter 11 bankruptcy protection.

With the support of its lenders, Ascend will use the process to pursue a value-maximising restructuring transaction that will enable the company to emerge from Chapter 11 as a healthy, well-capitalised business.

To help achieve that end, the bankruptcy process will enable Ascend to deleverage its balance sheet and continue providing best-in-class materials. Ascend’s subsidiaries that are located outside of the US are not included in the Chapter 11 filings.

Ascend has also received a commitment for $250m in debtor-in-possession financing from its lenders, which is expected to provide the company with sufficient liquidity to support it throughout the Chapter 11 process, which Ascend aims to complete in approximately six months.

“Ascend has made significant strides in transforming our business, with a focus on efficiency and driving cost reductions while ensuring that we are able to operate safer than we ever have before,” said Phil McDivitt, president and chief executive of Ascend Performance Materials. “Over the last several months, we have been working with our lenders to define the best path forward for Ascend.

“We expect that the restructuring will substantially reduce Ascend’s funded debt obligations and ensure that we are well-positioned to continue executing on our long-term strategy,” he continued. “We are confident that the Chapter 11 process will put us on a path to becoming an even stronger company with a healthier financial structure and better positioned to continue delivering high-performance materials that improve the lives of our customers.”

Founded in 2009 and headquartered in Houston, Texas, Ascend has nine global locations, including five fully integrated manufacturing facilities in the southeastern US and an engineering plastics compounding facility in Europe. The company has nearly 1650 customers globally.

The company intends to operate as usual throughout the Chapter 11 process and will continue to manufacture and produce high-performance materials.

“Our lenders, who believe in the underlying value and potential of our business, have provided us with funding to support our business throughout the process,” concluded Mr McDivitt. “We are also grateful to our customers and partners for their ongoing support and to our employees for their hard work and commitment to working safely and supporting Ascend’s other values.”

News: Ascend Files For Chapter 11 Bankruptcy; Local Site To Continue Normal Operations

Digital transformation: PCH files for Chapter 11

BY Fraser Tennant

Amid growing financial strain, US direct to consumer marketing company Publishers Clearing House (PCH) has filed for Chapter 11 bankruptcy protection in order to reorganise its capital structure and improve its long-term growth trajectory.

According to the court filing, PCH entered bankruptcy with $490,000 in cash and approximately $40m in debts to employees, vendors, service providers and landlords after a years-long decline in its legacy direct mail marketing business.

The company intends to use the financial restructuring process to finalise its shift away from these legacy businesses to focus on its transformation to a pure digital advertising business.

To fund operations without disruption, PCH has lined up debtor-in-possession financing which, subject to court approval, the company anticipates will provide liquidity to support operations during the reorganisation process.

As part of this process, PCH has also engaged advisers to explore a variety of strategic options, including the potential sale of its digital assets or a capital infusion from a financial partner that will help fund the company’s longer-term business plan going forward.

“By taking these steps, we are breaking free from the past financial constraints of our legacy direct mail and online retail merchandise and magazine subscription operating model,” said Adam Goldberg, chief executive of PCH. “This action establishes a strong foundation for our future – enabling PCH to unlock the full potential of its digital advertising and consumer insights business.”

PCH’s renowned Prize Patrol team is expected to continue during the restructuring process, awarding prizes to sweepstakes winners across the US with the famous big cheque, champagne and flowers that have endeared the PCH brand to consumers for over 50 years.

“Our world-renowned sweepstakes will continue to be a cornerstone of our experiences,” added Mr Goldberg. “We intend to continue offering free-to-play entertainment and awarding prizes in the ordinary course of business during and after this process to uphold the historic legacy of PCH.”

Throughout the restructuring process, PCH is committed to operating in a business as usual manner in order to continue delivering for its valued customers, partners, clients and employees.

Mr Goldberg said the Chapter 11 filing “marks a crucial development in PCH’s transition to a digital advertising-supported entertainment company”.

News: Sweepstakes company Publishers Clearing House goes bankrupt

Genetic testing firm 23andMe files for Chapter 11 bankruptcy

BY Richard Summerfield

DNA testing firm 23andMe has filed for Chapter 11 to help sell itself. Anne Wojcicki, 23andMe’s co-founder who has been attempting to take the company private, has stepped down from her role with the intent to become an outside bidder for the asset sale.

23andMe filed for bankruptcy protection in the US Bankruptcy Court for the Eastern District of Missouri to “facilitate a sale process to maximise the value of its business”. The company plans to sell its assets through a Chapter 11 plan which, if approved by the court, will see 23andMe “actively solicit qualified bids” over a 45-day process.

The company has between $100m and $500m in estimated assets, as well as between $100m and $500m in estimated liabilities, according to the bankruptcy filing. To support the business in the months ahead, private equity (PE) firm JMB Capital Partners has committed up to $35m of debtor-in-possession financing.

Ms Wojcicki will remain a member of the board. Joseph Selsavage, 23andMe’s chief financial and accounting officer, will serve as interim chief executive, according to a filing with the US Securities and Exchange Commission.

“After a thorough evaluation of strategic alternatives, we have determined that a court-supervised sale process is the best path forward to maximize the value of the business,” said Mark Jensen, chair and member of the special committee of the board. “We expect the court-supervised process will advance our efforts to address the operational and financial challenges we face, including further cost reductions and the resolution of legal and leasehold liabilities. We believe in the value of our people and our assets and hope that this process allows our mission of helping people access, understand and benefit from the human genome to live on for the benefit of customers and patients.

“We want to thank our employees for their dedication to 23andMe’s mission. We are committed to supporting them as we move through the process. In addition, we are committed to continuing to safeguard customer data and being transparent about the management of user data going forward, and data privacy will be an important consideration in any potential transaction,” he added.

23andMe has endured a difficult few years both financially and reputationally. The company was subject to an enormous data breach in 2023 that affected the data of nearly 7 million people, about half of its customers. Since that breach, revenues have fallen as many of its customers scrambled to delete their DNA data from the company’s archives. Amid falling share prices and a dwindling customer base, the company reduced its workforce by around 200 people – roughly 40 percent of its staff – and stopped development of all its therapies in November. The company also agreed to pay $30m and undergo three years of security monitoring to settle a lawsuit accusing it of failing to protect the privacy of those customers whose personal information was exposed in the data breach.

Since April 2024 Ms Wojcicki had pushed to buy out 23andMe, but her efforts were rebuffed by the board. Most recently, Ms Wojcicki and her PE partner New Mountain offered to acquire all of 23andMe’s outstanding shares for $2.53 per share, or an equity value of approximately $74.7m in February 2025, however that offer was rejected. Earlier this month she offered $0.41 per share, an 84 percent cut from an offer the previous month since her PE partner in that bid had walked following the board’s rejection.

News: DNA testing firm 23andMe files for bankruptcy as demand dries up

Better positioned: Spirit Airlines emerges from Chapter 11

BY Fraser Tennant

With significantly less debt and greater financial flexibility, US carrier Spirit Airlines has emerged from Chapter 11 bankruptcy having completed its financial restructuring – a stronger company better positioned for long-term success.

As part of the restructuring, Spirit received a $350m equity investment from existing investors to support the company’s future initiatives, including investments to provide its customers with enhanced travel experiences and greater value.

The Florida-based airline filed for bankruptcy protection in November 2024, after years of losses, failed merger attempts and heavy debt levels. Reporting a net loss of $1.2bn in 2024, Spirit Airlines was the first major US carrier to file for Chapter 11 since 2011. 

“We are pleased to complete our streamlined restructuring and emerge in a stronger financial position to continue our transformation and investments,” said Ted Christie, president and chief executive of Spirit Airlines. “Throughout this process, we have continued to make meaningful progress enhancing our product offerings, while also focusing on returning to profitability and positioning our airline for long-term success.”

As part of its turnaround strategy, the company has said it would shift its focus away from price-conscious customers to more affluent travellers, in a move it estimates would generate 13 percent more revenue per passenger. In a further bid to attract customers, the airline plans to redesign its loyalty programme and enter into alliances with other carriers.

Following emergence from Chapter 11, Spirit will continue to be led by Mr Christie and its existing executive team. In addition, the company also emerges with a reconstituted board of directors.

A leading low-fare carrier committed to delivering an enhanced travel experience with flexible, affordable options, Spirit serves destinations throughout the US, Latin America and the Caribbean. It is one of the youngest and most fuel-efficient fleets in the US.

“Despite the challenges we have faced as an organisation, we are emerging as a stronger and more focused airline,” concluded Mr Christie. “On behalf of the executive team, I would also like to thank our outgoing board members for their contributions and invaluable service to our airline."

News: Spirit Airlines targets more affluent travelers after emerging from bankruptcy

Battery maker Northvolt files for Chapter 11

BY Fraser Tennant

Despite exhaustive efforts to secure a viable financial and operational future, Swedish battery maker Northvolt has filed for Chapter 11 bankruptcy in Sweden.

The company, like many in the battery sector, has experienced a series of challenges in recent months that eroded its financial position, including rising capital costs, geopolitical instability, subsequent supply chain disruptions and shifts in market demand.

Northvolt has also faced significant internal challenges in its ramp-up of production, both in ways that were expected by engagement in what is a highly complex industry, and others which were unforeseen.

The company sought Chapter 11 bankruptcy protection in the US in November 2024, but despite liquidity support from its lenders and key counterparties, it was unable to secure the necessary financial conditions to continue in its current form.

As a result, the board of directors at Northvolt determined that Chapter 11 bankruptcy in Sweden was the only available solution while the company pursues all realistic options to obtain financing to continue operating during the Swedish bankruptcy process.

“This is a difficult time for everyone at Northvolt,” said Tom Johnstone, interim chairman of the board at Northvolt. “We set out to build something groundbreaking – to drive real change in the battery, electric vehicle and wider European industry and accelerate the transition to a green and sustainable future.”

This future includes the improvement and upwards trajectory of Northvolt's production in Skellefteå, where cell output from serial production lines has doubled and the company has secured a 50 percent improvement in production yield since September 2024.   

“Northvolt has come a long way, and we are beginning to see the real outcomes of our work, including production line improvements that helped customers bring more electric vehicles to the market more quickly,” continued Mr Johnstone. “It remains key for Europe to have a homegrown battery industry, but it is a marathon to build such an industry. It needs patience and long-term commitment from all stakeholders.”

The company is hopeful that the outreach it has undertaken with potential investors during the Chapter 11 process will accelerate identifying the necessary financing to allow continued trading under the Swedish bankruptcy process.

Mr Johnstone concluded: “We are hopeful that the foundation we built – the technology, the expertise and the commitment to sustainability – will continue to drive change in the industry.”

News: Swedish battery maker Northvolt files for bankruptcy