By Bansari Mayur Kamdar
(Reuters) – U.S. companies are feeling the heat of decades-high interest rates and sticky inflation, with several filing for bankruptcy protection as the era of easy money draws to a close.
The tally of U.S. companies that have gone bankrupt so far in 2023 is higher than the first five months of any year since 2010, data from S&P Global Market Intelligence showed.
There were 54 corporate bankruptcy petitions in May compared with 52 in April, according to S&P Global, with the year-to-date count more than doubling to 286 from a year earlier.
Consumer discretionary companies reported a higher number of bankruptcies than any other sector in 2023, according to S&P Global, while industrials sector also saw a sharp uptick with eight companies including Monitronics filing for bankruptcy in May.
Vice Media, was the latest victim in the communication services sector as a weak advertising market hits tech and news media companies.
Company Bankruptcy Reason
The KKR & Co Inc-backed
Envision Healthcare May 15 medical staffing firm filed for
bankruptcy protection, impacted by
high labor costs and a long battle
with insurer UnitedHealth Group for
the past few years.
The subsidiary of Carrier
Kidde-Fenwal May 14 Global that specializes in fire
control systems, filed for
bankruptcy, as it buckles under the
weight of lawsuits alleging that
“forever chemicals” in its
firefighting foam products have
contaminated water sources around
U.S. airports and military bases.
The home security systems
Monitronics May 14 provider with more than $1 billion in
International debt due in 2024 filed for
bankruptcy a second time to help
implement its restructuring.
Apr 26 The talc supplier filed for
Whittaker, Clark & bankruptcy protection, citing a
Daniels “deluge” of lawsuits alleging that
its talc products caused asbestos
exposure and cancer.
Bed Apr 23 Bed Bath & Beyond filed for
Bath & Beyond bankruptcy protection after the home
goods retailer failed to secure funds
to stay afloat.
LTL Apr 4 The Johnson & Johnson talc subsidiary
Management filed for bankruptcy protection for a
second time with the intent to
present a reorganization plan with a
proposed $8.9 billion settlement to a
judge as soon as May 14.
SVB Mar 17 SVB Financial Group filed for
Financial Group bankruptcy protection to seek buyers
for its assets, days after its former
unit Silicon Valley Bank was taken
over by U.S. regulators.
Diamond Mar 14 Diamond Sports Group, which provides
Sports Group local television broadcasts for
nearly half of NBA, NHL and MLB
games, filed for bankruptcy
protection, caught between expensive
broadcast rights agreements and
sports viewers’ cord-cutting habits.
Avaya Feb 14 Avaya filed for bankruptcy and
secured a financing of $780 million
as it restructures its business.
Serta Jan 23 Mattress maker Serta Simmons Bedding
Simmons Bedding filed for bankruptcy protection in an
effort to eliminate most of its debt.
Party Jan 17 The party supplies retailer filed for
City Holdco bankruptcy protection, as
persistently high inflation takes a
toll on consumer spending.
Source: S&P Global Market Intelligence, Refinitiv Eikon
(Reporting by Bansari Mayur Kamdar in Bengaluru; Editing by Anil D’Silva and Vinay Dwivedi)