The parent company of one of the nation’s largest aboveground pool manufacturers filed for Chapter 11 bankruptcy protection last month.
Shapes/Arch Holdings, LLC, based in Delair, N.J., makes aluminum for a wide range of products, including aboveground pools. The firm reported a $48.5 million decline in revenue for 2007.
According to the court filing, the firm experienced a “significant liquidity crisis,” that resulted in its inability to pay bills. This was exacerbated by the seasonality of a number of divisions, including Delair.
Calls to Shapes/Arch were not returned by press time.
Shapes/Arch plans to continue normal operations while the bankruptcy case proceeds. This includes all manufacturing in the Delair, N.J., plant where 600 employees build the company’s well-known lines of aboveground pools.
Delair was founded in the early 1960s as the Esther Williams Swimming Pool Co. The famous name of the champion swimmer and “swimming musical” movie star helped the company ride high on the pool-building wave of the mid-20th century suburban boom.
The Delair division also produces aboveground pools under the brands Infinity, Symphony Series and Johnny Weissmuller, as well as Delguard aluminum fencing.
Aboveground pool sales have fallen in recent years and occupy a significantly smaller market share than they did during the product’s heyday in the 1960s and ’70s. Sales have dropped 45 percent since 1999 — and by 8 percent in the past year alone, according to research firm PK Data, based in Duluth, Ga.
The housing boom of the past decade, and the home equity it created, led many consumers to opt for more expensive and sophisticated inground projects. The rising popularity of inflatable “soft-wall” pools sold by major retailers such as Wal-Mart also cut into the market for aboveground pools made with traditional aluminum shells.
Shapes/Arch’s bankruptcy recovery plan hinges on loans floated by its existing lenders — CIT Group Inc., JP Morgan Chase & Co. and Textron Corp. Those three companies have agreed to lend Shapes/Arch up to $60 million.
In addition, a Philadelphia-based private equity group, Versa Capital Management Inc., has agreed to lend Shapes/Arch $25 million in exchange for 80 percent voting control over the company during reorganization. Versa is a private equity firm that specializes in coming to the rescue of distressed companies.
“We buy something broken, and we try to get it fixed,” Greg Segall, managing partner of Philadelphia-based Versa Capital, told the Web site Philly.com.
Shapes/Arch is in the Guinness World Records for building the largest free-standing aluminum structure when it constructed scaffolding around the Statue of Liberty for the monument’s renovation in 1984.