Robertshaw: $650M Debt Cut in Lender-Led Sale

Robertshaw US Holding Corp.'s chapter 11 resolved a year of creditor-on-creditor conflict through a lender-led 363 sale that converted senior debt into ownership and left a liquidation plan to wind down the estate. The flow control components manufacturer filed chapter 11 on February 15, 2024 in the U.S. Bankruptcy Court for the Southern District of Texas (Case No. 24-90052), before Judge Christopher M. Lopez. The voluntary petition opened a restructuring anchored by a $56 million DIP, cash-collateral access, and a pre-arranged sale of substantially all assets to Range Red Operating, Inc., a vehicle formed by an ad hoc group of senior lenders including Bain Capital, Canyon Partners, and Eaton Vance, together with equity sponsor One Rock Capital Partners.

Robertshaw's debt stack and lender dynamics shaped the case. Prepetition funded debt totaled about $832.8 million across seven superpriority tranches and a Mexican promissory note, with trade debt of roughly $37 million. The company received a $56 million DIP facility and moved quickly to a credit-bid sale. In June 2024, Judge Christopher M. Lopez approved a sale to a lender-backed buyer, and Robertshaw later emerged from chapter 11 in early October after confirmation of a liquidation plan. The emergence announcement said the transaction eliminated approximately $650 million of debt and delivered recoveries to trade creditors, while litigation between lending groups continued to influence case posture.

Debtor(s)	Robertshaw US Holding Corp. (and affiliated debtors)
Case Number	24-90052 (CML)
Court	U.S. Bankruptcy Court, Southern District of Texas (Houston Division)
Judge	Hon. Christopher M. Lopez
Petition Date	February 15, 2024
Confirmation Date	August 16, 2024
Effective Date	October 1, 2024
Total Funded Debt	Approximately $832.8 million
DIP Facility	Up to $56 million delayed-draw term loan (PIK interest up to 9.5%)
Employees	5,200+ globally; 149 in the U.S.
Industry	Appliance and HVAC components manufacturing

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Business Profile and One Rock Ownership

Robertshaw is a global designer and manufacturer of flow control components — gas and water valves, energy regulators, thermostats, and electronic controls — for residential and commercial appliance, HVAC, and transportation applications. In the first day declaration, the company reported serving roughly 2,400 customers across home appliance, commercial, and aftermarket segments through 11 manufacturing facilities, three engineering centers, and four distribution centers in North America, Europe, Asia, and Latin America. Two non-debtor maquiladora subsidiaries in Matamoros, Mexico performed manufacturing and assembly for the debtor entities and accounted for roughly 3,200 of the company's more than 5,200 employees — a cross-border structure that shaped the centralized cash management and intercompany arrangements the debtors later sought to preserve.

Ownership history. Robertshaw's leverage traced to successive private equity ownership. In 2014, Sun European Partners acquired the former Invensys Appliance division from Schneider Electric. One Rock Capital Partners completed its acquisition of Robertshaw in March 2018, and an affiliate of One Rock, through Range Parent, Inc., remained the majority owner entering the case. The 2018 buyout established the capital structure that successive out-of-court amendments later layered into the seven-tranche superpriority stack at the center of the chapter 11.

Seven-Tranche Superpriority Stack

Robertshaw entered chapter 11 with a layered superpriority term loan structure totaling approximately $832.8 million, plus trade payables of roughly $37 million. The debt was divided into multiple priority tranches established by intercreditor agreements, the product of successive out-of-court restructuring transactions dating back to 2022. Delaware Trust Company served as administrative agent for the superpriority facilities and, as of January 31, 2024, also acted as successor agent for the sixth-out and seventh-out loans.

Superpriority term loan stack. The first day declaration disclosed the following principal amounts outstanding as of the petition date:

Tranche	Principal Outstanding
First-Out term loans	$218,411,857
Second-Out term loans	$381,193,571
Third-Out term loans	$72,826,886
Fourth-Out term loans	$22,824,861
Fifth-Out term loans	$29,184,932
Sixth-Out loans	$78,924,296
Seventh-Out loans	$16,282,985
FGI Mexican promissory note	$13,200,000
Total	$832,849,388

The intercreditor structure placed first-out through fifth-out lenders at the top of the priority stack, with sixth-out and seventh-out lenders junior to those superpriority tranches. The first-through-fifth-out facilities held first-priority liens on substantially all assets and were held primarily by the ad hoc group of Bain Capital, Canyon Partners, and Eaton Vance and, originally, Invesco. The Mexican promissory note was secured by first-priority liens on specified equipment in Matamoros, Mexico. Maturities for the sixth-out and seventh-out loans were February 28, 2025 and February 28, 2026, respectively, and the superpriority facilities were subject to springing triggers that could accelerate maturity to as early as January 28, 2025 if at least $12.5 million of sixth-out loans remained outstanding.

Priority mechanics and control. The superpriority lenders controlled both the cash collateral consent and the ability to credit-bid in a 363 sale. Those lenders formed the stalking horse purchaser and submitted the credit bid. Junior tranches and unsecured creditors recovered through the additional sale consideration pools and the liquidation trust rather than from ongoing enterprise value, matching the relative lien positions in the intercreditor agreements.

Trade and unsecured claims. Trade claims were estimated at about $37 million. The plan later classified general unsecured claims in Class 5, funded debt deficiency claims in classes 6a through 6g by tranche, and established separate treatment for the Mexican promissory note claims. Additional sale consideration pools were allocated by class, forming the basis for recoveries to general unsecured and funded debt deficiency claim holders.

Distress, the Invesco Veto, and Lender Litigation

The company's distress combined operational pressure with a fight over control of its credit facility. The first day declaration attributed the deterioration to pandemic-era supply chain disruptions, customer inventory stockpiling followed by a 2022 demand drop as customers de-stocked, unrecovered inflation, and a Mexican product-line relocation that raised rather than reduced costs. Financial performance declined: gross profit of $85.8 million and EBITDA of $30.3 million for the fiscal year ended March 2023 fell to $58.8 million and $14.8 million, respectively, for the nine months ended December 2023. Beginning in spring 2022 the company replaced senior leadership, installed a new CFO in June 2022, and engaged Guggenheim Securities and Latham & Watkins to pursue refinancing; the resulting May 2023 transactions injected $95 million of new money but restructured the facility into the multi-tranche superpriority stack that became the source of later intercreditor friction.

Missed interest payment and amendments. On September 29, 2023, Robertshaw missed an interest payment of approximately $18 million, triggering a five-business-day cure period that ran to October 6, 2023. Invesco, holding "Required Lender" status under the superpriority credit agreement, negotiated a series of amendments and a forbearance agreement that extended deadlines, imposed escalating milestones — including an original filing deadline of January 2, 2024 — and added roughly $17 million of incremental first-out financing to fund the missed payment. In mid-2023 Robertshaw reached a non-binding agreement with Brigade Capital Management to refinance its ABL facility, but Invesco used its veto to block the transaction, forcing the company into the forbearance framework.

Governance changes. The fourth amendment contemplated a chapter 11 filing and a 363 sale timeline and required appointment of an independent director. The company appointed Neal Goldman as an independent director on November 20, 2023, part of the forbearance framework and lender oversight as the company evaluated a court-supervised sale process.

December 2023 transactions and litigation. In early December, Robertshaw and One Rock pursued an out-of-court alternative with the ad hoc group of Bain Capital, Canyon Partners, and Eaton Vance. The company said the December 2023 transactions provided $44 million of new liquidity, partially assigned Invesco's position, and stripped Invesco of its Required Lender status. On December 20, 2023, ten days after the transactions closed, Invesco filed suit in New York state court alleging breach of contract, tortious interference, and fraudulent transfer, widening the conflict that carried into the chapter 11 case.

Adversary proceedings and the control fight. On the petition date the debtors and ad hoc group commenced two adversary proceedings (Adv. Proc. 24-03024 and 24-03025), including an adversary complaint against Invesco and a separate action to enjoin Invesco's state-court litigation under the automatic stay. In June 2024, Judge Lopez ruled that the lender group led by Bain Capital, Eaton Vance, Canyon Partners, and One Rock could continue steering the restructuring, a decision that rejected Invesco's bid to regain control. In a related ruling, the court found the December 2023 transactions violated the credit agreement but declined to rescind them, limiting Invesco's remedy to breach of contract damages rather than equitable relief. The case followed a May 2023 uptier transaction that reallocated priority among lenders, and reporting characterized the dispute as an example of creditor-on-creditor conflict within a single credit facility.

Invesco proof of claim and the claim order. Invesco filed a proof of claim exceeding $125 million, asserting prepayment damages of roughly $39.4 million, debt-and-equity damages of $66.6 million to $102.5 million, litigation expenses of about $12.5 million, and prejudgment interest, and separately demanded about $100 million in recoveries during the case. On August 21, 2024, the court entered the Invesco claim order allowing a Class 6 funded debt claim of $50,329,210 — comprising $39,408,199 in prepayment damages and $10,921,011 in fees and expenses, plus prejudgment interest on the prepayment damages at New York's 9.00% statutory rate from December 11, 2023 to the petition date — while disallowing the larger debt-and-equity damages theory. Invesco appealed the claim order on August 26, 2024 and filed a cross-appeal on September 9, 2024.

Delayed-Draw DIP and Cash Collateral Controls

Robertshaw relied on cash collateral and a delayed-draw DIP facility to fund operations during the sale process. The interim cash collateral order entered on February 15, 2024 approved a 13-week budget and required weekly variance testing. Disbursements were capped at 115% of projected amounts, and minimum liquidity was set at $2 million. The order established a carve-out for professional fees and U.S. Trustee costs, with a post-trigger cap of $2.5 million for professional fees.

Final DIP and cash collateral order. The final order entered March 21, 2024 approved a $56 million DIP facility and tightened liquidity and reporting requirements. The final order retained the 115% disbursement test and added an 85% minimum cash receipts test. The minimum liquidity threshold increased to $5 million, and weekly variance reporting was required. The DIP was a delayed-draw term loan facility with PIK interest up to 9.5%, a 5% commitment fee, and a 5% exit fee, as set out in the executed DIP credit agreement. Coverage of the DIP and purchase agreement described the financing and lender-backed sale structure.

DIP Term	Amount
Facility size	$56,000,000
Interest rate	Up to 9.5% PIK
Commitment fee	5%
Exit fee	5%

Budget and variance tests. The cash collateral framework imposed weekly testing and liquidity thresholds, using a rolling 13-week budget process. The interim order required budgets to be delivered before each four-week period and deemed approved absent objection, while the final order added a minimum cash receipts test and increased minimum liquidity. The key operating covenants are summarized below.

Cash Collateral Covenant	Interim Order	Final Order
Disbursement variance test	Not to exceed 115% of projected	115% test retained
Minimum receipts test	Not included	At least 85% of projected receipts
Minimum liquidity	$2,000,000	$5,000,000
Budget cadence	Rolling 13-week budget; four-week testing periods	Rolling 13-week budget with weekly variance reporting

Carve-out structure. The interim order established a carve-out for U.S. Trustee and clerk fees, trustee fees up to $75,000, and professional fee caps. Post-trigger professional fees were capped at $2.5 million, with carve-out reserves funded weekly. The final order preserved these mechanics and allowed certain prepetition lender advisors and DIP advisors to be paid outside the normal interim and final fee application process, subject to specified limits.

Cash management system. Robertshaw operated a highly centralized cash management system tied to its global manufacturing footprint. At the petition date, the system included 56 bank accounts, but only four were held by debtor entities in the U.S.; the remaining 52 accounts belonged to 24 non-debtor affiliates, largely outside the U.S. Court filings emphasized that intercompany transactions supported manufacturing flows, overhead allocations, and working capital loans. Maintaining the existing system was presented as critical to avoiding operational disruption and preserving cash collections during the sale process.

Operating continuity. The cash collateral budget covered payroll, vendor payments, and logistics costs tied to global appliance production and supported intercompany flows across the debtor and non-debtor entities, including the Mexican manufacturing operations.

Sale to Range Red Operating

The court approved a tight sale timeline to preserve value and align with the DIP budget. The bidding procedures order entered March 21, 2024 approved the stalking horse APA and set the schedule below:

Milestone	Date
Qualified bid deadline	May 3, 2024 at 4:00 p.m. CT
Auction (if needed)	May 7, 2024 at 10:00 a.m. CT
Sale hearing	May 14, 2024 at 10:00 a.m. CT

No competing bids were received, and the debtors filed a notice of cancellation of auction designating the stalking horse bid as the successful bid. Bid protections did not include a break-up fee, but the stalking horse was eligible for expense reimbursement capped at $2.5 million. The stalking horse purchaser, Range Red Operating, Inc., was formed by the required lenders under the superpriority credit agreement and included participation by an affiliate of One Rock Capital Partners. Coverage described the buyer group as including Bain Capital, Eaton Vance, Canyon Partners, and One Rock, with Judge Lopez approving the sale in late June. Bloomberg Law reported the sale to a lender group and noted that One Rock would hold a minority stake post-sale.

Purchase price components. The sale order approved a credit bid of roughly $273 million — all DIP obligations of $56 million plus $217 million of first-out indebtedness — together with a cash closing payment equal to the post-effective-date budget amount and the additional sale consideration pools specified in the plan, for total aggregate consideration of approximately $282 million. The order also approved assumption of specified liabilities, including cure costs, post-closing operating liabilities, transferred employee liabilities, postpetition accrued trade payables, and certain taxes. The court found the transaction to be the highest and best offer and granted good-faith purchaser protections under section 363(m).

Invesco's appeal. Invesco filed a notice of appeal of the sale order on June 26, 2024 and an emergency motion to stay the sale on July 18, 2024. The court granted an interim stay on August 12, 2024, but confirmed the plan four days later, on August 16. Robertshaw closed the sale hours before the Fifth Circuit issued a separate stay, and the plan's October 1 effective date rendered Invesco's appeal effectively moot.

Debt reduction. Public announcements around the sale framed the transaction as a material deleveraging. A June 2024 sale approval release stated the transaction was expected to eliminate around $660 million of debt. The emergence release later described debt elimination of roughly $650 million.

Liquidating Plan and Committee Settlement

The confirmed plan was a liquidation plan designed to administer sale proceeds, resolve claims, and pursue retained causes of action. The plan established a plan administrator, a liquidation trust, and additional sale consideration pools that defined creditor recoveries. It also included release and exculpation provisions approved in the confirmation order, with opt-out mechanics that permitted certain parties, including Invesco, to avoid third-party releases. The U.S. Trustee challenged the plan's release structure following the Supreme Court's Purdue Pharma decision, arguing that opt-out consent was insufficient; Judge Lopez overruled the objection, confirming that opt-out procedures remain sufficient under Fifth Circuit precedent.

Plan administrator and governance. The plan appointed Stephen Spitzer of AlixPartners LLP as plan administrator and authorized him to serve as the sole officer or manager of the post-effective-date debtors. The plan administrator's authority was set out in a plan administration agreement filed with the plan supplement. This governance model centralized decision-making for the wind-down and for prosecution of retained causes of action.

Liquidation trust. The plan created a liquidation trust effective on the plan's effective date to hold retained causes of action, with Stephen S. Gray named in the plan supplement as liquidation trustee under a wind-down budget that included $250,000 for the trustee and its professionals. The trust beneficiaries were holders of allowed general unsecured claims (Class 5) and allowed first-out funded debt deficiency claims (Class 6a). The trust structure allowed litigation recoveries, if any — including potential claims against Invesco-affiliated parties arising from the prepetition transactions — to be distributed to those beneficiaries rather than to the operating business that had been sold.

Additional sale consideration pools. Two cash pools were funded on or before the effective date:

Pool	Amount	Purpose
Funded Debt Deficiency Claim Pool	$10,000,000	Distributions to funded debt deficiency claimants
GUC Recovery Pool	$11,000,000 (minus go-forward trade amounts)	Distributions to general unsecured claims

The GUC Recovery Pool was reduced by amounts paid on go-forward trade claims under the APA, and claims held by Invesco and its affiliates were treated as funded debt deficiency claims rather than general unsecured claims.

Class treatment and the Committee Settlement. The confirmation order approved a plan built around a settlement among the debtors, the official committee of unsecured creditors, the ad hoc group, and One Rock. As part of that settlement the ad hoc group and One Rock waived their own first-out and second-out deficiency claims, leaving the $10 million Funded Debt Deficiency Claim Pool available only to non-consenting lenders and other funded debt holders, including Invesco. The plan's classes were treated as follows:

Class	Claim Type	Treatment
1–2	Other priority and other secured	Unimpaired; paid in full or collateral returned
3	Prepetition secured superpriority	Indirect ownership of Range Red Operating; no additional cash
4	FGI Mexican promissory note	Reinstated
5	General unsecured	Pro rata share of $11 million GUC pool plus liquidation trust proceeds
6a	First-out funded debt deficiency	Share of $10 million pool plus trust proceeds (ad hoc group and One Rock waived)
6b–6g	Second- through seventh-out deficiency	Pro rata share of $10 million pool
7–10	Intercompany, subordinated, and existing equity	Cancelled; no distribution

Classes 5, 6a, and 6f voted to accept the plan, while DIP, administrative, priority tax, and professional fee claims were unclassified and paid in full from sale proceeds. Existing equity was cancelled, converting the senior lenders' credit bid into ownership of the post-sale business.

Trade creditor outcomes. The post-emergence release stated that trade creditors received over 75% of their pre-bankruptcy claims. The same release described a seven-month restructuring process and noted the timing coincided with the company's 125th anniversary. The plan structure and sale economics meant recoveries were driven by the $11 million GUC pool and the possibility of additional distributions from the liquidation trust.

Debt elimination. Both the sale approval announcement and the emergence announcement emphasized debt reduction. The June 2024 release cited an expected elimination of roughly $660 million, while the October 2024 release cited about $650 million. The figures reflect a deleveraging of most of the superpriority term loan stack through credit-bid conversion.

Professional Retentions and the Weil Investigation

The debtors retained Latham & Watkins as lead bankruptcy counsel, Hunton Andrews Kurth as co-counsel, AlixPartners as financial advisor, and Guggenheim Securities as investment banker, with Weil, Gotshal & Manges engaged as special investigation counsel. Weil's mandate was to analyze potential claims arising from the May 2023 transactions, the blocked Brigade ABL refinancing, and Amendments Nos. 1–5 to the superpriority credit agreement, along with potential fiduciary-duty and avoidance actions against proposed released parties — the prepetition conduct at the center of the Invesco dispute. The official committee of unsecured creditors retained McDermott Will & Emery as counsel and FTI Consulting as financial advisor.

Professional	Role	Fees and Expenses
Latham & Watkins LLP	Lead counsel	$17,756,509 (combined)
Guggenheim Securities, LLC	Investment banker	$7,914,053
AlixPartners, LLP	Financial advisor	$6,451,481
McDermott Will & Emery LLP	Committee counsel	$4,810,701
Hunton Andrews Kurth LLP	Co-counsel	$3,577,617
FTI Consulting, Inc.	Committee financial advisor	$2,188,862
Weil, Gotshal & Manges LLP	Special investigation counsel	$1,626,124

Guggenheim's compensation included monthly fees totaling $1,050,000, an $840,000 financing fee, and a $6,500,000 restructuring fee, net of a $825,000 fee credit. The court entered a final fee order on November 22, 2024 allowing Latham combined compensation and reimbursement of $17,756,509 for the February 15 through October 1, 2024 period, reported as a single total rather than separately stated fees and expenses.

Key Timeline

The following table tracks Robertshaw's timeline from its first private equity ownership change through plan emergence. Court approval of the restructuring came on August 16, 2024, with the plan effective date of October 1 following six weeks later.

Date	Event
June 2014	Sun European Partners acquired the Invensys Appliance division that became Robertshaw Controls Company
March 1, 2018	One Rock Capital Partners completed its acquisition of Robertshaw
May 2023	Uptier transaction among lenders altered priority and triggered disputes
September 29, 2023	Missed approximately $18 million interest payment
December 11, 2023	Ad hoc lender group provided $44 million of new liquidity
December 20, 2023	Invesco filed New York state court complaint challenging the December transactions
February 15, 2024	Chapter 11 petitions filed in S.D. Texas
March 21, 2024	Final DIP and bidding procedures orders entered
June 20, 2024	Court ruled the lender group could continue to steer the case
June 21, 2024	Sale order entered approving transaction with Range Red Operating, Inc.
July 31, 2024	First amended plan of liquidation filed
August 16, 2024	Confirmation order entered
October 1, 2024	Plan effective date
October 2, 2024	Company announced emergence following sale completion

Frequently Asked Questions

Why did Robertshaw file for chapter 11?

Court filings pointed to operational and market pressures that reduced profitability, including pandemic-era supply chain disruptions, customer inventory stockpiling, a 2022 demand drop as customers de-stocked, and inflation-driven cost increases. At the same time, the company's multi-tranche superpriority capital structure limited flexibility and contributed to lender disputes. The combination of reduced earnings and a complex priority stack led to a restructuring centered on a lender-backed sale and liquidation plan.

Where were the cases filed, and which judge oversaw the case?

Robertshaw filed in the U.S. Bankruptcy Court for the Southern District of Texas (Houston Division). The case was assigned to Judge Christopher M. Lopez.

How much debt did Robertshaw report at the petition date?

The company reported approximately $832.8 million of funded debt across the superpriority tranches and a Mexican promissory note, plus roughly $37 million in trade debt. The funded debt was divided into seven term-loan tranches plus the FGI Mexican promissory note, each with its own priority position under the intercreditor agreements.

What financing supported the case during chapter 11?

Robertshaw used cash collateral and a delayed-draw DIP term loan. The DIP facility authorized up to $56 million of new money, with PIK interest up to 9.5% and 5% commitment and exit fees. The final cash collateral order also imposed a 115% disbursement variance test, an 85% minimum receipts test, and a $5 million minimum liquidity threshold.

Who bought the operating assets, and what did the buyer pay?

The purchaser was Range Red Operating, Inc., a Delaware entity formed by the required lenders under the superpriority facilities, with participation by an affiliate of One Rock Capital Partners. The sale consideration consisted of a credit bid for all DIP obligations plus $217 million of first-out indebtedness, together with a cash closing payment tied to the post-effective-date budget and additional sale consideration pools per the sale order. Bloomberg Law described the buyer group as including Bain Capital, One Rock, Eaton Vance, and Canyon.

What did trade creditors recover under the plan?

The company's emergence announcement stated that trade creditors received over 75% of their pre-bankruptcy claims. The plan funded an $11 million GUC Recovery Pool (reduced by go-forward trade payments) and established a liquidation trust to pursue retained causes of action for potential additional recoveries.

Did Robertshaw emerge from chapter 11?

Yes. The plan became effective on October 1, 2024, and the company announced the completion of the sale and emergence from chapter 11 on October 2, 2024.

Were there administrative claims bar dates?

Yes. The court's administrative claims bar date order set an administrative claims bar date of July 26, 2024 at 4:00 p.m. CT for administrative claims arising between February 15, 2024 and June 7, 2024. A later administrative claims bar date of October 31, 2024 applied to administrative claims arising after June 7, 2024, as detailed in the notice of effective date.

Who is the claims agent for Robertshaw US Holding Corp.?

Kroll Restructuring Administration LLC serves as the claims and noticing agent, appointed under the court's retention order entered February 22, 2024. In that role Kroll administered the claims register and case notices, including the administrative claims bar dates of July 26, 2024 and October 31, 2024 established by the court's bar date order.

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