HAMLET — One Richmond County manufacturer facing financial difficulties has filed for bankruptcy.
Enviva, “the world’s largest producer of industrial wood pellets,” announced on March 12 that it has ”entered into two Restructuring Support Agreements … designed to support an expedited restructuring to reduce the Company’s debt by approximately $1.0 billion, as well as improve profitability, strengthen liquidity, and better position the business for long-term success…”
The move comes following a 2023 third quarter net loss of $85.2 million. That loss included: “$21.2 million of asset impairments, $22.1 million of interest expense on repurchase accounting, and $6.3 million of restructuring costs that were not incurred during the same period last year,” according to a November press release from the company.
According to filings, Enviva has an estimated $1-10 billion in liabilities, and an estimated 1,000-5,000 creditors.
“These agreements with our lenders and noteholders represent a significant milestone in the ongoing process to transform our business, as we focus on improving profitability, reducing costs, enhancing asset productivity, and optimizing our capital structure,” Interim Chief Executive Officer and Chief Financial Officer Glenn Nunziata said in a press release.
“We look forward to emerging from this process as a stronger company with a solid financial foundation and better positioned to be a leader in the future growth of the wood-based biomass industry,” Nunziata added. “We appreciate the support of our lenders, our vendors, and our customers, and the tremendous efforts of our entire team as we continue to execute our transformation plan.”
Enviva has reportedly “secured a commitment for $500 million of debtor-in-possession financing” to fund its ongoing operations and meet its obligations to vendors. Enviva also expects to complete construction of a plant in Epes, Alabama.
Despite the company’s filing, operations at the plant north of Hamlet on N.C. 177 will not be impacted, according to Chris Brown, Mid-Atlantic senior community relations manager.
“We will continue to source fiber, produce pellets, and transport them to our customers,” Brown said in an email. “Thanks to our plant leadership and all of our Hamlet associates, the Hamlet facility is running extremely well.”
Enviva also has plants in Hertford, Sampson, Northampton counties, as well as Mississippi, Georgia, South Carolina and Virginia.
The Hamlet plant was first announced in 2014 and opened in 2019 — two years later than originally anticipated. The Hamlet plant employs around 120 people, according to Brown. The corporate website states the plant also ”supports an estimated 180 additional jobs including logging, transportation, and local services.”
The production capacity of the Hamlet plant is 600,000 metric tons of wood pellets per year, shipped from the port in Wilmington.
Enviva has faced opposition to the local plant — and its other facilities — from the Dogwood Alliance, an Asheville-based environmental group, along with Concerned Citizens of Richmond County, partly due to its proximity to Dobbins Heights, a minority community.
Dogwood Alliance accuses Enviva of profiting “from excessive carbon emissions, destroying forests, and polluting communities.”
“For years, Enviva has deceived customers, destroyed forests, and polluted communities,” Danna Smith, executive director of the Dogwood Alliance said in a statement Wednesday, following the news of the bankruptcy filing. “And it’s finally caught up to them.
“They’ve wasted millions of taxpayer dollars,” Smith continued. “Our government must not give one more dime to this failing, dirty industry. Instead, we need to focus on recovery and transition. We need a shift to forest protection, not more destruction.”
Enviva has made efforts to be a community partner in Richmond County, donating thousands of dollars to BackPack Pals, and distributing turkeys and volunteering with Habitat for Humanity in Dobbins Heights.
The company also established the Enviva Forest Conservation Fund in 2015, a 10-year, $5 million program to protect “environmentally sensitive bottomland and wetland forests,” which is administered by the U.S. Endowment for Forestry and Communities.
In January, the EFCF and Three Rivers Land Trust worked together to protect 440 acres of bottomland hardwood forest along the Little River and Uwharrie National Forest in Montgomery County.
