Equipment financing firm DVI and its U.S. subsidiaries DVI Financial Services and DVI Business Credit have filed voluntary petitions for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of Delaware.
DVI chose to file for reorganization as a result of significant financial difficulties stemming from an unsuccessful diversification strategy, unsuccessful integration of business units, decreased profitability, concerns regarding near-term liquidity requirements, and the recent discovery of possible accounting irregularities, according to the Jamison, PA-based firm.
DVI said the objective of the Chapter 11 bankruptcy proceedings is to maximize recovery for creditors by facilitating an orderly sale of assets. The firm is in discussions with several parties regarding a potential sale.
In other developments, DVI has retained Latham & Watkins as legal counsel, and appointed crisis management firm AlixPartners as crisis managers. AlixPartners principal Mark Toney has been named DVI’s CEO, replacing Michael O’Hanlon. O’Hanlon resigned in conjunction with the filing.
DVI is continuing to seek debtor-in-possession financing, as well as to generate cash within the company to sustain operations while trying to sell its assets.
By AuntMinnie.com staff writersAugust 26, 2003
Related Reading
DVI to file for bankruptcy, August 14, 2003
DVI misses interest payment, August 4, 2003
DVI default notice rescinded, firm hires new auditor, July 18, 2003
DVI gets default notice, July 16, 2003
DVI retains UBS Securities, July 1, 2003
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