Home Truck News Pride Group’s U.S. fleet Arnold Transportation ceases operations - Truck News

Pride Group’s U.S. fleet Arnold Transportation ceases operations – Truck News

Pride Group’s U.S. fleet Arnold Transportation, which it purchased in 2022, has laid off its employees.

An April 30 Worker Adjustment & Retraining Notification report with the Texas Workforce Commission, indicates there were 157 affected employees. The FMCSA reports Arnold had 402 power units and 341 drivers.

Arnold Transportation truck
(Photo: Arnold Transportation)

Court filings indicate Arnold Transportation Group was still tightly interwoven with its parent company, Pride Group, which filed for bankruptcy protection in late March. Arnold operated from a property leased from a Pride company and documents indicate Arnold hadn’t been profitable since its 2022 acquisition.

Arnold’s trucks were also leased from a Pride Group business and it was financed with intercompany loans and factoring. Once cut off by factoring company Triumph Factoring Services, its only source of liquidity was intercompany advances or DIP (Debtor-in-Possession) financing; Pride secured a $30 million DIP facility in early April in order to continue its operations.

DIP financings are intended to allow a business in creditor protection to continue operating, while giving the lender priority over a debtor’s assets, if and when they are distributed. “In order to make them eligible to borrow under the DIP Term Sheet, the Syndicate Lenders require ‘know your client’ information be provided,” court documents indicate.

The company was unable to provide that information in time to secure advances under the DIP facility needed to satisfy its financial obligations. It did secure intercompany loans from Pride Truck Sales to the tune of US$800,000 to fund fuel costs and employee wages and benefits.

Attempts were made to sell Arnold Group assets.

“In the event that a sale cannot be consummated in short order, the Arnold Group will have no choice but to cease operations and liquidate,” reads a bankruptcy monitor report dated April 24. “Bankruptcy proceedings are considered to be a last resort for the Arnold Group, but such proceedings may become necessary in the short term if a sale transaction cannot be negotiated.”

Meanwhile, back in Ontario, there are ongoing efforts to sell Pride Group’s real estate, with all properties set to be listed by May 1. Deals for properties in Bolingbrook, Ill., Chehalis, Wash., and Cornwall, Ont., have been reached and are expected to close this month.

Credit: Source link


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