Shareholders of Williams Industrial Services Group Inc. (WLMSQ) are looking forward to seeing the reorganization plan after the company has filed for Chapter 11. The Department of Justice sets Monday, July 31, 2023, at 4:00 p.m. as the the deadline to appoint an Official Committee of Unsecured Creditors. So, after tomorrow, the way ahead will be clarified, and the reorganization plan to emerge from Chapter 11 bankruptcy has to be submitted to the court for approval. The successful completion of the plan of reorganization would take three months, or a little over.
The purchase agreement enables the company to raise $60 million in new financing pursuant to the plan. The company’s streamlining of such substantial liquidity, compared to its outstanding shares (27 million), raised pursuant to the plan, provides the company with a secure footing to pursue opportunities in the construction industry and grow value for its stakeholders. Filing for Chapter 11 Bankruptcy would establish a firm financial footing and put the market recovery well underway.
On the other hand, the stock price reaction last week was far away from the fair value and terms of the reorganization, which is justified when we trace the stock price reaction before the announcement of Chapter 11 Bankruptcy. The stock was not drawing the attention of the market due to the lack of press releases and messages from the board of directors. Subject to the coming approvals, the company’s road to emergence from Chapter 11 is very likely and depends on the diligent guidance of the board members through this process, the management team, and the employees for maintaining safety leadership and operational excellence through challenging times. Finally, the emergence of Williams Industrial from Chapter 11 will not be the first case. Many other recent companies that filed for Chapter 11 emerged within less than a year, such as NOVNQ, NMTRQ, and CORZQ. The stock prices recovered from less than 7 cents to about $1. The top five stock owners are: Wynnefield Capital Management LLC (23.75%); Minerva Advisors LLC (6.93%); Wittenberg Investment Management, Inc. (2.43%); Vanguard Group Inc (2.36%); and Wedbush Securities Inc.
By: Qasem Masarwah