By: Jim Rosenberg
In completing its capital restructuring Nov. 19, Goss Graphic Systems Inc. emerged from bankrupcty under a court-
Goss signed a $250 million bank credit agreement -$150 million in term loans, $100 million in revolving credit that replaces a $200 million bank agreement and interim financing provided by the company’s lenders and principal stockholder, Stonington Partners.
The reorganization also includes $50 million in new equity capital from Stonington Partners and a swap by Goss Holdings Inc. of $225 million principal amount of notes of Goss Graphic Systems for half that amount in senior subordinated notes that include a 2-1/2-year moratorium on cash interest. Also, noteholders will receive approximately one-third of common stock in Goss Holdings.
Jim Sheehan, Goss chairman and chief executive, called the new capital structure ?more in line with the nature of our business? and said the lower debt and added liquidity are important to restoring profitability at Goss’ Americas unit. Goss also is looking at further reducing costs and refining its product portfolio to focus on those with the strongest global appeal – though it will remain in the business of extending existing presses, as needed, with the same type of equipment, according to Marketing Director Barbara Gora.
At the same time, Goss said it will close its Reading, Pa., factory next year after transferring assembly of Community, Magnum, Urbanite, and G18 single-width presses to its Cedar Rapids, Iowa, facility and consolidating production of its Universal single-wide presses at its plant in Nantes, France, where the semicommercial models were developed. Product transfer begins January 1. Reading will continue to function as a warehousing and storage operation for approximately six months.
Goss called the consolidation ?a key component in . . . efforts to streamline manufacturing processes.? The move follows an internal reorganization that has consolidated worldwide manufacturing under Senior Vice President Matt Cribari. Consolidation of assembly in Cedar Rapids, Sheehan said, should better enable Goss to meet customers’ needs ?by reducing cycle times and accelerating global supply chain initiatives? and will allow integration of ?best practices across several product lines.?
Goss also appointed two new members to its board of directors: Les Kraft, a former long-time Goss executive, and Tom Cochill, former president of WebCraft Technologies Ind., a commercial printer.
Jim Rosenberg (email@example.com) is associate editor for Editor & Publisher magazine.
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