Asbestos Forces Armstrong Into Chapter 11

Armstrong Holdings' major operating subsidiary, Armstrong World Industries, has filed Chapter l I bankruptcy. hoping a reorganization can help resolve its asbestos liabilities.

Two Armstrong World subsidiaries, Nitram Liquidators and Desseaux Corp., also filed for protec- tion. Yet, Armstrong Holdings, Triangle Pacific Corp. (Bruce Hardwood Flooring, Hartco Flooring and Robbins Hardwood Flooring), ceiling grid joint venture WAVE, Armstrong Canada and its other nonU.S. operating subsidiaries were not included in the filing.

Armstrong said all divisions were operating as usual and suppliers would be paid on normal terms for goods delivered and services provided after the Chapter 1l filing.

Echoing Owens Cornings' recent, reluctant bankruptcy flling (see Nov., p. 22), Armstrong chairman and ceo Michael D. Lockhart said, "Our historical approach to resolving asbestos claims has not worked. The actions that would now be required to wait for legislation-for which there is no reasonable hope for quick passagewould reduce our ability to invest in our businesses. Armstrong comprises profitable, industry leading businesses. We can no longer allow the asbestos uncertainty to eat away at these businesses. nor can we cutback on investment without damaging them."

With $4 billion in consolidated assets, Armstrong has over 1,000 creditors and $3.3 billion in liabilities, and was a defendant in an estimated 175,000 pending asbestos-related personal injury claims.

To enhance its liquidity, Armstrong said, it obtained a commitment for $400 million debtor-in-possession financing with Chase Manhattan Bank.

Hayward Unit Adds Rail Spur

Hayward Lumber, Santa Maria, Ca., has installed a rail spur for unloading lumber directly at the yard, eliminating the need to truck the material from a nearby rail stop.

Company officials said lumber can be unloaded within a few hours without causing any interruptions for other customers.

The firm plans to enlarge its operation, including building a 50,000 sq. ft. manufacturing facility that could be run entirely on solar power.

Studies are currently being conducted to see if the roof can be affixed with solar panels to power the entire operation, according to general manager Randy Harris.

The new plant will make roof and floor trusses, wall panels and prehung doors, he said. and could lead to the hiring of scores of new employees.

He added that the company plans to be more green-minded, including stocking wood from environmentallysensitive mills and promoting use of recycled materials.