Dick Simon Trucking files for bankruptcy protection

SALT LAKE CITY (Feb. 26, 2002, via truckinginfo.com) — Dick Simon Trucking and its parent company, Simon Transportation Services, have voluntary filed for Chapter 11 reorganization under the U.S. Bankruptcy Code.

The Salt Lake City-based company said it plans to downsize its fleet and generate money by selling off assets and will lay off an undisclosed number of employees. The company said it continues to operate its business and serve customers as usual as it solicits interested bidders for its assets.

In a written statement, Simon Transportation Services said the decision to seek reorganization was based on a combination of economic, industry, and company-specific factors, including “poor revenue production, high insurance costs, and significant disruption in the new and used equipment markets, among other factors” which have created substantial losses.

During the reorganization period, the company plans to reduce the size of its tractor and trailer fleet by as much as 40%, beginning immediately. It intends to pursue the fleet reduction over the next several weeks, matching available trucks to the most desirable customer accounts, traffic lanes, and regions. Fully implemented, the plan will result in a fleet of approximately 1500 tractors and 2200 trailers.

“We decided to reorganize only after months of struggling to increase the cash flow of the business and the infusion of significant capital by our majority stockholder,” said CEO Jon Isaacson. “Unfortunately, our sources of liquidity dried up before we could turn around the operations in the face of challenging industry conditions and an economy in recession.”

During the reorganization process, the company said vendors, suppliers, and other business partners will be paid under normal terms for goods and services provided during the reorganization.