Tough times are ahead for Geneva-based company A2 Services LLC, doing business as Geneva Pipeline, as the company is filing for bankruptcy. Their Chapter 11 bankruptcy petition was filed recently with the Bankruptcy Court of the Northern District of Ohio, and in it, Geneva Pipeline has stated that it intends to reorganize.
Clearly some great challenges are on the horizon for the company, which specializes in the installation and maintenance of underground infrastructure for vital utilities, including gas, communications, water and electricity. It serves a very wide area that includes several states. However, its assets are estimated to be around $1 million, while the estimated liabilities are scaling $4.4 million. These figures have led the company to take drastic action.
Lawyers representing the company are saying that there could not have been a worse time for the owners to have bought Geneva Pipeline. They say that the company’s business model – with pricing and costs never finding a happy meeting place – ultimately failed. The suggestion is that the company needs to bring in an equity partner, and make efforts to restructure its contracts.
The future may be uncertain for Geneva Pipeline, but the company is no doubt remaining hopeful. Chapter 11 bankruptcy is most commonly used by corporate entities, and it allows businesses to reorganize without shutting down operations or going into liquidation. It is one of several avenues of relief available to struggling entities under the United States Bankruptcy Code. Chapter 7 and Chapter 13 bankruptcy are other potential options when a business or consumer files for bankruptcy. Which chapter is the best fit depends on the business’ or individual’s circumstances.
The bankruptcy process can be confusing. To get through it as quickly and easily as possible, it is generally a good idea to work with a bankruptcy attorney.
Source: Crain’s Cleveland Business, “Geneva Pipeline files for Chapter 11 bankruptcy petition, plans to reorganize,” Michelle Park, April 18, 2014