Industry giant Latham International has filed
for Chapter 11 bankruptcy protection.
Based in Latham, N.Y., the firm owns vinyl-liner-pool producer
Latham Manufacturing; fiberglass-pool maker Viking Pools,
LLC ; cover manufacturer Coverstar, LLC; and Kafko
Corp. , which makes vinyl-liner pools, covers, domes and other
Latham President/CEO Mark Laven said the move is
“We were not forced into bankruptcy,” Laven said.
“We took this action voluntarily, proactively, in order to
address the amount of debt that the company had on the
The plan would switch ownership of the firm’s assets to a
newly formed company. As far as operations, Laven said no changes
will occur and that the company will retain its current management,
staff, facilities and brands. Latham currently has 551 employees in
the United States.
“[The filing] means one and only one change for the
company — that it is going to be delevered, meaning that
it’s going to have less outstanding debt on its books,”
But speed is of the essence, and Latham officials wanted to
fast-track the proceedings in order to protect the firm. “I
believe that the debtors will run out of cash in early February
2010 if they do not emerge from Chapter 11 before then,”
Laven stated in the court filing.
The company also hoped to announce bankruptcy confirmation
before the Atlantic City Pool & Spa Show in late January in
order to avoid hurting 2010 sales. This would assure customers that
financial issues have been resolved, company officials stated.
To expedite the process, the firm filed a prepackaged bankruptcy
plan, in which the debtor and creditors devised a reorganization
strategy ahead of the filing. These types of arrangements must
receive approval by shareholders beforehand, and tend to move
faster. If the plan is approved, Latham expects to be out of
bankruptcy by Feb. 1, 2010.
Laven said he expects to hear from the court in a matter of days
as to whether or not it approves the proposal.
“The company is operating very well,” Laven said.
“We are profitable and current with our payments to all of
our vendors, and [the] obligations that we have servicing our
lenders. … All of our obligations have been met in a timely
manner. As the nation’s largest manufacturer of inground
swimming pools, our sales have declined, but I’m proud to say
not nearly at the same rate as the overall market
In its bankruptcy filing, Latham attributed the firm’s
difficulties to the economic downturn. In response to market
conditions, the company “made significant headcount
reductions,” trimmed its manufacturing facilities from 32 to
15, and underwent an inventory reduction initiative between 2007
and 2009, according to the filing.
The company reported nearly $67 million in assets and $239.4
million in debt. For the 2009 fiscal year through November, Latham
reported net sales of almost $90.2 million and losses of $181.4
Approximately 35 percent of the company is owned by Covington,
La.-based distributor PoolCorp , said Laven. The same amount is held by
Moran & Partners , a Boca Raton, Fla.–based private
equity firm. Another 4-percent is owned by Apollo
Investment Corp. and the rest is held by officers, employees
and former employees of Latham.
Latham is the largest producer of inground pool components and
accessories in North America according to company officials. In
addition to the brands mentioned, the firm is also affiliated with
Pools , Fort Wayne Pools , Elite ,
Sterling, Performance, Technician, Triac and CPC, according to the company’s
For further coverage of Latham’s filing, see our Dec. 30
enewsletter and the Jan. 15 print edition of Pool & Spa