Despite its efforts to reorganize, Cold Carriers Logistics and its entities will cease operations on Feb. 21 after failing to secure a new buyer, according to a source familiar with the bankruptcy case.
One truck driver, who didn’t want to be named, told FreightWaves he was notified on Feb. 4 that his job would be ending in a few weeks.
Another truck driver told FreightWaves he was shocked by the news as he had been reassured the company was reorganizing and planned to continue operating.
Stunned truck drivers and employees started posting on social media Monday afternoon that Cold Carriers was permanently closing its doors, as first reported by Freightbrokerlive.com.
Private equity firm KJM Capital Transportation Fund LLC, which owns Cold Carriers Logistics and six other affiliates, filed for Chapter 11 bankruptcy protection in late September 2019, a move that impacted around 340 truck drivers.
As of press time, Kenneth Meister, founder and senior managing director of KJM Capital, declined FreightWaves’ request for comment regarding the news Cold Carriers was shuttering operations.
On Jan. 27, Cold Carriers’ bankruptcy attorney R. Scott Shuker filed a notice to withdraw its Chapter 11 reorganization plan, which was originally filed on Nov. 5 in the U.S. Bankruptcy Court for the Middle District of Florida.
One source said the wind-down was triggered after the carrier defaulted on payments to some of its major creditors.
The plan now is to “work to get equipment back to home base locations,” the source told FreightWaves.
The company was banking on a cash infusion or buyer, but Shuker said Cold Carriers failed to “identify our equity investor by Jan. 16,” a deadline set by one of its major creditors, at a hearing on Jan. 21.
At the hearing, Shuker said that Cold Carriers originally had three investors interested in buying the refrigerated company, but that none came through with “either new money or a new financing deal” by Jan. 16.
Shuker said Cold Carriers was in talks with a “long shot” investor, but the deal fell through prior to the deadline.
“We had one final party that we were working with and had a letter of intent, and ultimately, they just backed out,” Shuker told U.S. Bankruptcy Judge Karen Jennemann at the hearing.
Shuker said the wind-down would affect three operating trucking companies, including Interide Transport, which had 106 employees, Sunco Trucking, which was the largest entity with 142 employees and 62 independent contractors, and Gantt Trucking, which had about 90 employees.
Cold Carriers filed Chapter 11 bankruptcy on Sept. 27. In its “bare bones” bankruptcy petitions, it listed assets and liabilities as between $10 million and $50 million.
This is a developing story.