Celadon Closes Doors, Industry Reacts
INDIANAPOLIS - Indianapolis-based Celadon Group, Inc. has filed for Chapter 11 bankruptcy and shut down all of its business operations. The company plans to use the bankruptcy filing to wind down its global operations, a move that will affect approximately 4,000 employees.
Chief Executive Officer Paul Svindland confirmed the filing and plans to cease operations in a statement released early today:
"We have diligently explored all possible options to restructure Celadon and keep business operations ongoing, however, a number of legacy and market headwinds made this impossible to achieve," Svindland said. "Celadon has faced significant costs associated with a multi-year investigation into the actions of former management, including the restatement of financial statements. When combined with the enormous challenges in the industry, and our significant debt obligations, Celadon was unable to address our significant liquidity constraints through asset sales or other restructuring strategies. Therefore, in conjunction with our lenders, we concluded that Celadon had no choice but to cease all operations and proceed with the orderly and safe wind down of our operations through the Chapter 11 process."
Barbara Hunt, vice president of the Indiana Motor Truck Association, says Celadon has been a member of the organization for 25 years. In a statement to Inside Indiana Business, she said the IMTA is "deeply saddened" by the company's abrupt decision to cease operations.
"These drivers, technicians and staff are working hard to get home or to another place of employment that they can trust and continue being the professionals that they are," said Hunt. "his closure doesn’t just impact the state of Indiana, it impacts us nationally and in ways we are still trying to wrap our arms around. IMTA members, among many other trucking companies, have joined together to offer support. This display of solidarity shows the strength and bond of people in trucking."
Hunt encourages people to visit the "Celadon Closure Assistance and Jobs" page on Facebook if they would like to assist the drivers affected by the move.
Indianapolis Mayor Joe Hogsett released the following statement:
“Today’s decision by Celadon is the result of the worst kind of corporate recklessness, with the actions of a few highly-paid executives creating tragedy for workers across Central Indiana.
While I am concerned about the future of the Celadon campus on the far eastside and the economic impact of its closure, my top priority is the well-being of Indianapolis families affected by this announcement.
I have directed my office and Employ Indy to immediately begin working with the Indy Chamber, as well as community partners like Ascend Indiana, to identify impacted workers and connect them with short-term resources, as well as training and tools that will provide a pathway to new career opportunities.”
Last week, Celadon’s former chief operating officer and chief financial officer were indicted on multiple federal fraud charges related to an alleged securities and accounting scheme that resulted in a more than $60 million drop in shareholder value.
Founded in 1985, Celadon grew into the largest provider of international truckload services in North America with a fleet of 3,300 tractors, 10,000 trailers and nearly 4,000 employees