Plastics that owes Muni’s debt to bankruptcy to fuel recycling plant

(Bloomberg) – An Indiana recycling plant that filed for a municipal bond investor six years ago filed for bankruptcy after it destroyed the facility due to design defects and production splashes.

Brightmark Plastics Renewal LLC (Converting Waste Plastics to Fuel) filed Chapter 11 on Sunday, listing assets and liabilities between $100 million and $500 million. The plant has 113 employees and has $172.5 million in outstanding municipal bonds.

The document comes after Brightark Plastics missed a March 1 debt payment. The plant’s owner, San Francisco-based Brightmark Energy, has contributed more than $211 million in equity and determined it cannot continue to invest in the project. The company’s bonds were finally traded for about 16 cents on February 10 for US dollars. They were released in March 2019.

Brightmark CEO Bob Powell did not respond to voicemails and emails seeking comments.

Recycling projects across the United States have been plagued by a range of problems in recent years, from expected demand to surge in production costs. By default, about $1 billion of the $9.3 billion in so-called green municipal industrial development bonds, according to data compiled by Bloomberg.

The highlight plant is located in Ashley, Indiana, from a drink bottle to a car seat, and then heats the plastic without oxygen until the hydrocarbon turns into vapor. The hydrocarbon vapor is cooled into the pyrolyzed oil and cut into various fuels, including diesel.

The facility opened in 2022 and is plagued by many problems, according to court documents filed by Craig R. Jalbert, chief restructuring officer of Brightmark Plastics.

According to Jalbert’s documents, the plant needs to be redesigned and redesigned, and needs the units needed to turn oil into wax. Furthermore, Brightmark decided to focus on producing pyrolytic oil after determining that fuel production was unprofitable. The plant operates at 5% capacity each year and processes 100,000 tons of plastic waste each year.

Alliancebernstein Holding LP funds are the largest holder of Brightmark Plastic bonds, with about $56 million, according to data compiled by Bloomberg. As of December 31, Pacific Investment Management held $50 million.

Alliancebernstein spokesman Carly Symington did not respond to a request for comment. PIMCO spokesman Agnes Crane declined to comment.

Brightmark hired SSG Advisors, LLC to sell the plant. Brighmark, together with the Bridge lender, agreed to provide debtor financing to keep the factory open through the sale.

“There is a huge demand for debtors’ products because it allows its customers to incorporate into their manufacturing process, which is made from about 60% of post-consumer plastic waste instead of Virgin fossil fuels,” Brightmark’s Jalbert wrote in the filing.

The case is highlighted by plastic Renewal LLC et al., No. 25-10472, U.S. Bankruptcy Court, Delaware Area.

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