Spandex Maker Lycra Files for Bankruptcy After Years of Stress

Spandex maker The Lycra Company has filed for Chapter 11 bankruptcy in Texas to implement a restructuring deal that will see most of its debt written off after creditors took control of the business.

The transaction will slash long-term debt by $1.2 billion, while providing additional capital of more than $75 million to support the company’s operations during and after the restructuring, Lycra chief financial officer Dean Williams said in the filing on Tuesday. Customers, suppliers and the company’s 2,000 employees will not be affected, according to the filing.