Bioplastics maker Cereplast Inc. has filed for Chapter 11 bankruptcy protection in the U.S.
According to a press release, the Seymour, Ind.-based company “has taken this action to strengthen its balance sheet, clean up its capitalization structure and gain financial flexibility as it continues to realign its operations.”
Cereplast also said that it intends to continue to operate during the reorganization process.
As part of the reorganization, Cereplast said, it expects to redirect its operations in two directions: (1) toward traditional compounded products and recycling polyolefin and (2) bioplastic made of diversified feedstock including algae and polylactic acid.
"We intend to use the reorganization process to help implement our plan to lower costs, stabilize our businesses, grow revenue and diversify our product lines," said Frederic Scheer, Cereplast's CEO. "We have taken a number of steps to improve our operations over the past few months and we were making great progress; however, the lack of traction of bioplastics demand in the U.S., the repetitive delays in implementation of the bioplastic regulation in Europe and especially in Italy combined with the legal problems created by several of our lenders made clear to our Board that reorganization was the proper path forward. We believe that this reorganization will enable us to reduce our debt and implement operational changes, while maintaining our commitment to the environment."
Last year, Cereplast moved its headquarters to Seymour – where it operates a bioplastics plant – from El Segundo, Calif.