BISMARCK, N.D. (AP) -- Motor Coach Industries Inc. says it has emerged from Chapter 11 bankruptcy protection with a new majority owner.
The Schaumburg, Ill.-based company operates a bus plant in Pembina, in northeast North Dakota that employs about 220 people. MCI says in a statement that a federal bankruptcy court approved a reorganization plan on Jan. 28.
MCI filed for Chapter 11 bankruptcy protection in September. The company said at the time that the pre-negotiated bankruptcy filing would reduce the company's debt by $420 million by cutting interest by $54 million annually.
The company said it had hoped to have the deal completed by February.
MCI said it has obtained a $230 million credit line, and its new majority owner, Franklin Mutual Advisers LLC, converted $200 million of debt into equity. Franklin Mutual Advisers is a subsidiary of San Mateo, Calif.-based Franklin Resources, Inc., a global investment management company.
MCI says it also got a $155 million loan from a group of lenders.
"The completion of our financial restructuring is a major milestone in the 76-year history of MCI," Tom Sorrells, MCI president and chief operating officer, said in the statement. "I am particularly pleased that, given a very challenging economic backdrop and the tight credit markets, we were able to complete the process in just seven months."
MCI makes big buses for public transportation and motor coaches that are used as luxury RVs. At its peak in the mid-1990s, the Pembina bus plant had more than 800 people on the payroll.
Patricia Ziska, an MCI vice president, said the company now employs about 1,920 people, most of whom work at the company's main plant in Winnipeg, 60 miles north of Pembina.
The company uses the Pembina bus plant to satiate conditions of the federal Buy America Act, which requires buses involved in federal contracts be produced in the United States.
Bus sales have been flat, with anticipated sales this year of 850 to 1,000 vehicles, Ziska said. The company has averaged more than 1,200 bus sales annually in recent years, she said.
Ziska said federal stimulus funds to local governments for public transportation should spur bus sales beginning this year, by more than 25 vehicles.
North Dakota has provided the company with incentives in the past, including low-interest loans. State officials say those loans have all been paid off.