Burke Industries files petition under Chapter 11

SANTA FE SPRINGS, Calif. (July 27)—Burke Industries Inc. has filed for voluntary protection from creditors under Chapter 11 of the bankruptcy code in the U.S. Bankruptcy Court for the District of New Jersey to stabilize the company's declining financial condition. The firm cited a general economic downturn; rapidly increasing utilities, insurance, some raw materials and other overhead costs; and debt obligations as contributing to its sliding profits. The manufacturer of rubber-, silicone- and vinyl-based goods has secured a financing commitment from Bank of America, subject to court approval, it said. While under Chapter 11, the company will attempt to increase operating liquidity and continue implementing an operating and financial restructuring plan it began in 2000, it said in a prepared statement. Chapter 11 allows Burke Industries and its divisions to continue operating as it has in the past and make purchases. However, it can't legally pay suppliers for purchases delivered prior to the bankruptcy date until the court approves the payment.