Elizabeth-based New England Motor Freight voluntarily filed for relief under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of New Jersey in Newark on Monday.
The company and 10 related entities intends to use these proceedings to facilitate an orderly wind-down of its operations. Upon the recommendation of its advisors, the company has determined that a Chapter 11 proceeding is the best mechanism to maximize the value of its assets for the benefit of its employees and various creditor constituencies.
“We have worked hard to explore options for New England Motor Freight, but the macro-economic factors confronting this industry are significant,” Vincent Colistra, a senior managing director with Phoenix Management Services, and chief restructuring officer for the company, said in a statement. “Following two years of losses, and with continuing and unsustainable rises in overhead as well as a severe industry shortage of drivers, we have concluded that the company has no choice but to proceed with an orderly wind-down of operations in a Chapter 11 proceeding.”
New England Motor Freight provides less-than-truckload carrier services in the United States and Canada.