(RTTNews) - Compass Diversified Holdings (CODI) announced late Sunday that its subsidiary, Lugano Holding, Inc., has filed for Chapter 11 protection under the U.S. Bankruptcy Code.
According to Elias Sabo, Chief Executive Officer of CODI, the decision to file for Chapter 11 is the best choice for maximizing value from Lugano's assets.
The company noted that the filing does not involve its other eight subsidiaries, which collectively continue to generate strong cash flow and perform well in their respective markets.
Due to the bankruptcy filing, Lugano will no longer be consolidated with CODIs financial results, starting in the fourth quarter of 2025.
CODI, as Luganos senior secured lender, has agreed to provide the unit with debtor-in-possession financing to facilitate the bankruptcy process.
CODI said it continues to work constructively with its senior lender group and bondholders to ensure flexibility as it finalizes its financial restatement and completes other necessary filings with the Securities and Exchange Commission.
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