Armstrong Flooring shares fall as bankruptcy warning looks likely

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By Will Feuer


Armstrong Flooring Inc. shares fell more than 50% in premarket trading on Monday after the company warned it had not yet reached an agreement to sell itself and the company would likely file for protection against bankruptcy.

The Lancaster, Pa.-based company said it had amended some of its credit agreements while engaging with interested third parties to potentially sell out. The company said it has received expressions of interest and has until May 8 to strike a deal.

However, Armstrong said it seems unlikely that any interested party will be able to strike a deal by then. As a result, the company is likely to file for Chapter 11 bankruptcy protection, he said.

The company warned in November that worsening supply chain disruptions, as well as inflationary pressures expected to continue through 2022 on transportation, labor and raw materials, would likely put it in a situation of non-compliance with certain clauses of its credit agreements. At the time, the company warned of significant doubts about its ability to continue in business for the longer term.

On December 31, he said he had retained the services of Houlihan Lokey Capital Inc. to help him sell the business.

Shares of the company fell 54% in premarket trading Monday to 75 cents per share.


Write to Will Feuer at Will.Feuer@wsj.com

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