Anchor Glass Must Revise at Least 3 Years of Reports

Date: 8 August 2005
Source: Rednova.com

Date: 8 August 2005

Anchor Glass Container Corp.'s future grew bleaker Friday when it said it would revise at least three years' worth of financial reports and that it hired a law firm to help deal with the problem.

The troubled Tampa company, which makes bottles for beverages like Budweiser and Yoo-Hoo and calls itself the third-largest U.S. manufacturer of its type, said it will revise quarterly and annual reports as far back as 2001 because of what it described as "improper accounting."

Three separate payments from an unidentified customer were recorded improperly, leading Anchor to overstate or understate its earnings at various times.

"The financial statements of Anchor for the years 2001, 2002, 2003 and 2004 and for each of the quarters therein should not be relied upon," the company said in a news release Friday .

Chief financial officer Mark Burgess did not return a call seeking comment. Anchor's stock closed Friday at 42 cents per share, down 3 cents, for a new low.

The company expressed concern about its accounting in a July 18 news release. Compared to some of the other financial woes described in the statement, however, the issue loomed small.

Anchor said then that it expected to fall out of compliance with the terms of two lines of credit worth up to a total of $135 million, might not be able to muster funds to meet an Aug. 15 payment on its senior debt and was at some risk of filing for bankruptcy for what would be the third time in 10 years. The next day, Anchor's stock plunged 54 percent.

But Friday's update on the accounting issue may have strengthened the hand of shareholders who last year sued Anchor, its directors and officers, auditor Pricewaterhouse Coopers LLC; underwriters Credit Suisse First Boston, Lehman Brothers and Merrill Lynch & Co.; and Cerberus Capital Management LP, the New York hedge fund that bought the company out of bankruptcy in 2002 and took it public in September 2003 at $16 per share.

Among other things, the lawsuit alleged that Anchor's August 2003 prospectus, a disclosure statement meant to attract potential investors, omitted key facts and included others that were "untrue."

"To say that the company has had bad financials for two full years before even the (initial public offering of stock) is a problem," said Ken Vianale, a Boca Raton lawyer who is lead attorney for the plaintiffs. Anchor is liable for significant errors in the prospectus whether or not the errors were intentional, he added.

If Anchor does file for bankruptcy protection, however, it's unlikely shareholders will get any money from the company. Owners of common stock are assigned a very low repayment priority in bankruptcy court.

600450 Anchor Glass Must Revise at Least 3 Years of Reports glassonweb.com

See more news about:

Others also read

MORE...

Emirates Glass wins major supply contract for Palm Jumeirah
Emirates Glass, a Dubai Investment subsidiary, has won a major contract to supply 140,000 square meters of its premium glass to the prestigious development on the Palm Jumeirah, reaffirming its already established reputation as the single most prominent company in the entire regional glass industry.The deal was announced during the company's participation in the prestigious Big 5 show, the largest annual venue for the entire Middle-East glass contracting industry.
ISRA Receives Major Display Glass Inspection Order
Isra Vision Systems AG supplier of machine vision systems, has successfully improved its market position in display glass inspection with a major order totalling 1.8 Mio Euro.
Rexam, buyout firms to bid for Calmar-sources
Packagers such as the UK's Rexam and private equity firms are set to vie for pump-sprayer business Calmar, which France's Saint-Gobain (SGOB.
Company to close lime plant in Carey next month
The National Lime & Stone Co. will discontinue production of calcined lime early next month at its Carey plant, the company CEO announced Thursday.
China glass import a cheaper option for Amritsar firm
Jain Scientific Glass Works, manufacturers of glassware for laboratories, is importing glass as raw material from China, which was much cheaper than the local product and abundantly available.
Corning, AGC Glass-substrate Capacity Expansion Projects Unit: 1 furnace Company Location 2004 2005 2006 Corning U.S.
Japan 1 2 1 S. Korea 6 6 3 Southern Taiwan 4 2 0 Central Taiwan 0 4 2 AGC Japan 0 1 1 Taiwan (Yunlin) 1 1 1 Source: PIDA (Photonic Industry & Technology Development Association) Taiwan TFT-LCD Panel Makers Happy to See Substrate-price Falls in 2006 Taipei, Dec. 27, 2005 (CENS)--Both of the world's top-two glass-substrate makers are actively expanding their production capacity in Taiwan, which is expected to cut substrate transportation time and cost for local thin film transistor-liquid crystal display (TFT-LCD) panel makers and boost production efficiency, according to Michael Wang, project manager and senior analyst of Taiwan's PIDA (Photonic Industry & Technology Development Association).According to Wang, Asahi Glass Co. (AGC) of Japan has solved problems in lowering the defect-free rate for the production of fifth- and sixth-generation (5G, 6G) glass substrates, and is expected to tap the market with products with higher price competitiveness in 2006 to grab more market share in the 6G substrate businessIn addition, Wang added, the aggressive capacity added by both Corning of the U.S., the world's No. 1 substrate supplier, and AGC, the No. 2, will lead to price drops for glass substrates and will especially benefit TV panel makers such as AU Optronics Corp. (AUO) and Chi Mei Optoelectronics Corp. (CMO) in TaiwanCurrently, Wang pointed out, a 6G substrate is priced at about 27,000 to 30,000 Japanese yen, about 1,000 to 2,000 yen lower than in the third quarter of 2005.

Add new comment