Todd Shipyards Files For Bankruptcy Protection
JERSEY CITY, N.J. (AP) _ Todd Shipyards Corp. and its subsidiary, Todd Pacific Shipyard Corp., filed Monday for protection from creditors under Chapter 11 of the U.S. Bankruptcy Code, a company spokesman said.
The companies, based in Jersey City, made the filing in U.S. Bankruptcy Court in Newark, N.J., said Todd spokesman Owen McVeigh.
Todd Shipyards owns a yard in Galveston, Texas, and its subsidiary runs shipyards in Seattle and Los Angeles.
The company employs about 400 people at its Galveston shipyard, about 830 people in Seattle and about 1,350 in Los Angeles, McVeigh said.
The Seattle yard laid off about 70 production and administration workers Friday and expected to give notice to additional workers Monday, a shipyard spokeswoman said.
Todd said it will have to suspend all operations at its three shipyards unless it is able to obtain continued worker’s compensation coverage beyond Sept. 1.
At the end of its fiscal year in March, Todd reported a $46.8 million loss, the largest the company has suffered in more than a decade.
McVeigh described the company’s problems as numerous but declined to be more specific. ″We’re in the middle of a comprehensive financial and operational restructing right now,″ he said.
McVeigh did not know how many creditors were mentioned in the filing or how many stockholders the company has, but there are about 4 million shares of the company’s stock outstanding.
Todd also announced that Chemical Bank of New York had agreed to provide $50 million in credit secured by stock in The Aro Corp., a Todd subsidiary based in Bryan, Ohio, that manufactures air-powered equipment and pneumatic tools. The agreement between is subject to bankruptcy court approval, McVeigh said.
The bankruptcy filing does not affect Aro Corp., which the company says has been unaffected by the financial difficulties of the shipyards.
Operations at the Galveston shipyard were not expected to be immediately affected by the filing, McVeigh said. Company representatives had been sent to the shipyard to explain the filing to workers and management, he said.