Chesapeake Beverage Corp., a soft drink bottler based in Havre de Grace, has sought protection from creditors under the U.S. Bankruptcy Code after a plan to merge the company with another bottling firm in Oklahoma was put on hold, according to Bruce J. Hegstad, Chesapeake Beverage's president.
But Mr. Hegstad, a major investor in the bottler and former head of Kirschner Medical Corp., insists the company's business has not been hurt by the Chapter 11 filing and that it will survive.
"We want to be another Texaco or Toys 'R' Us, and we expect to do that. They all filed for Chapter 11 and came out of it OK," he said.
In the filing, Chesapeake Beverage listed assets of $4,250,000 and liabilities of $6,315,680.
Mr. Hegstad said that the company owes Maryland National Bank more than $3 million and has debts to numerous suppliers.
Yet Mr. Hegstad, who recently took over as the chief operating officer of Chesapeake Beverage in the wake of a management shake-up, said in an interview that the private company's business remains strong.
He said that it registered $4 million in revenue last year and that contracts with customers have been unaffected by the June filing.
"All of our suppliers are staying with us. All of our customers are staying with us. And we're at absolutely 100 percent production for the foreseeable future," Mr. Hegstad said of Chesapeake Beverage, which bottles soft drinks for a half-dozen brands and specializes in juice-added beverages.
Mr. Hegstad, who owns 45 percent of Chesapeake Beverage, said that after the bottling company's debts rose -- because of management problems -- the owners agreed to merge it with Whitlock Packaging Corp., an Oklahoma-based bottler. But he said the deal was postponed because of some problems with Whitlock.
Despite the reorganization filing, Chesapeake Beverage has no plans for layoffs at its Havre de Grace production facility, which employs 65 people, Mr. Hegstad said.
Mr. Hegstad resigned last February as president and chief executive officer of Kirschner Medical Corp., a Timonium-based manufacturer of orthopedic instruments and implants.