Case Summary: Ascend Performance Materials Chapter 11

Business Description

Headquartered in Houston, TX, Ascend Performance Materials Holdings Inc., along with its Debtor⁽¹⁾ and non-Debtor affiliates (collectively, "Ascend" or the "Company"), is a leading, fully-integrated manufacturer of Nylon 6,6 (polyamide 66 or “PA66”) and its chemical precursors.

Ascend operates globally with regional offices in Shanghai, Brussels, and Detroit, and manufacturing facilities across North America, Europe, and Asia, employing approximately 2,200 people worldwide.

• The Company serves nearly 1,650 customers globally, supplying a portfolio of branded materials such as Vydyne® PA66 resins and various specialty chemicals and fibers.
• Its PA66 materials are utilized in diverse applications requiring impact, heat, abrasion, and chemical resistance, including:
  • Automotive components (heating/cooling systems, airbags, tires, engine covers, radiators, fuel systems)
  • Electrical equipment (electrical connectors, circuit breakers)
  • Industrial fibers (airbag yarns, carpet fibers sold under names like Ultron™)
  • Consumer goods and apparel (appliances, athletic apparel – notably used in approximately 50% of Lululemon Athletica Inc.’s “Nulu” yoga pants and sports bras)
  • New technologies (electric vehicles, solar energy systems, batteries)
• Ascend holds significant market share in certain segments, composing approximately 40% of the global market for airbags and high-performance tires.

Since 2020, the Company has achieved average annual revenue of $2.7 billion. In 2024, sales were distributed geographically with approximately 41% in the Americas, 40% in Asia, and 19% in EMEAI.

The Debtors filed for Chapter 11 protection on April 21, 2025, in the U.S. Bankruptcy Court for the Southern District of Texas, reporting $1 billion to $10 billion in assets and liabilities as of the Petition Date.

⁽¹⁾ For a complete list of Debtor entities, see the organizational structure chart below.

Corporate History

Ascend's origins trace back to the mid-twentieth century with Chemstrand Corporation, a joint venture between Monsanto Chemical Company (“Monsanto”) and American Viscose Corporation, established to produce nylon fibers licensed from DuPont.

• Chemstrand established the first fully-integrated U.S. nylon plant in Pensacola, FL, in 1953.
• Monsanto acquired Chemstrand in 1961, operating it as its chemicals division.
• In 1997, Monsanto spun off its industrial chemical and fibers divisions, including the nylon business, into an independent company, Solutia Inc. (“Solutia”).

Ascend Performance Materials, as it exists today, was formed in 2009 when SK Titan Holdings LLC, an affiliate of New York-based private equity firm SK Capital Partners, acquired the nylon business from Solutia for $50 million in cash. This acquisition carved out Ascend as an independent entity focused on polyamide production, providing capital and management focus to turn around the previously unprofitable business.

Global Expansion and Acquisitions

• Under SK Capital's ownership, Ascend pursued aggressive expansion:
  • 2013: Expanded compounding capabilities in Pensacola, FL.
  • 2018: Acquired a compounding facility in Tilburg, Netherlands (later closed in 2024).
  • 2020: Acquired assets in Suzhou, China, and Poliblend/Esseti Plast in Mozzate, Italy. Also acquired Eurostar Engineering Plastics facility in Fosses, France (completed 2021).
  • 2022: Acquired a compounding site in San Jose Iturbide, Mexico; purchased Formulated Polymers Limited in Chennai, India; and acquired Circular Polymers, a California-based recycler, marking a push into sustainable materials.
  • 2024: Completed construction of its first non-U.S. chemical production facility in Lianyungang, China (Q3 2024).

Organizational Structure

Operations Overview

Ascend operates across the entire Nylon 6,6 value chain, from producing basic chemical intermediates to manufacturing finished engineered plastics and fibers. Its integrated structure allows participation in both the chemical intermediates and downstream PA66 markets.

PA66 Value Chain and Ascend's Participation

Manufacturing Footprint

• United States: Key facilities include Pensacola, FL (major nylon 6,6 polymer production); Decatur, AL (intermediates like ADN, polymer production); and Chocolate Bayou (Alvin), TX (produces AN and hydrogen cyanide (HCN)). These three sites account for approximately 85% of sales volume and 80% of revenue. A facility in Greenwood, SC (nylon polymer/fiber) was recently closed as part of cost-cutting. Circular Polymers operates a recycling facility in California.
• International: Facilities acquired for compounding and regional production/support include Mozzate, Italy; Fosses, France; Suzhou, China; Chennai, India; and San Jose Iturbide, Mexico. A new chemical plant operates in Lianyungang, China. A compounding facility in Tilburg, Netherlands, was closed in mid-2024.

Product Portfolio

• Chemical Intermediates: Ascend produces and sells key PA66 inputs, accounting for ~32% of 2024 revenue. These include:
  • Hexamethylene Diamine (HMD): ~14% of 2024 total revenue.
  • Adipic Acid (AA): ~8% of 2024 total revenue.
  • Hydrogen Cyanide (HCN): ~4% of 2024 total revenue (difficult to transport, significant use in Guest Program).
  • Acrylonitrile (AN): ~2% of 2024 total revenue.
  • Adiponitrile (ADN): ~1% of 2024 total revenue (precursor to HMD).
  • Acetonitrile (ACN): To be commercially available in 2026.
• Downstream PA66 Products: Sold into engineered materials, sustainable specialties, and textile markets (~65% of 2024 revenue combined).
  • Nylon & Engineered Plastics Division (~40% of annual revenue): Includes Vydyne® branded resins used in molded parts. Focus shifted towards higher-value compounded products offering enhanced strength and heat resistance.
  • Fibers & Textiles Division (~25% of annual revenue): Includes industrial fibers (e.g., for airbags) and residential carpet yarn (e.g., Ultron™).
  • Sustainable Materials: Leveraging recycled feedstock from Circular Polymers.
  • Innovation: Developed Acteev® antiviral nylon technology during the pandemic.

Guest Program

• Ascend operates a strategic partnership program at its Chocolate Bayou, Pensacola, and Decatur facilities involving nine "Guests."
• Guests utilize Ascend's facilities and certain chemical intermediates (notably HCN, which would otherwise require disposal) for their manufacturing processes. Ascend may also manage logistics for Guests.
• The program fosters economies of scale, shared expertise, and integrated production, lowering costs and enhancing efficiencies.
• In 2024, the Guest Program generated approximately $85 million in revenue and $167 million in cost recovery, making it a critical component of Ascend's operations.

Prepetition Obligations

Top Unsecured Claims

Events Leading to Bankruptcy