- Classic Recreations reportedly owes between $1,001,000 and $10 million in outstanding liabilities.
- Shelby American is said to have recently terminated its licensing agreement with the shop.
- The company plans to repay creditors after covering administrative fees and related expenses.
Over the last several years, Classic Recreations has introduced some of the finest and most expensive Ford Mustang restomods on the planet. With lightweight carbon fiber bodies, modernized powertrains, and custom-crafted interiors, many of these builds have pushed close to the $300,000 mark. Now, the company finds itself in a very different spotlight: as of July 9, it has filed for Chapter 11 bankruptcy in Texas.
Read: $625,000 Carbon Shelby GT500CR Centennial Edition Is A Heartthrob
Word of the bankruptcy filing came to us thanks to the Eleanor Mustang Fan Club. The company’s Chapter 11 filing in the Northern District of Texas reveals it currently has assets estimated at between $500,001 and $1 million while dealing with liabilities of between $1,000,001 and $10 million.
Shelby License Revoked, Uncertain Future
For many years, Classic Recreations has been a licensed Shelby American builder, but it’s understood that the latter recently terminated the licensing agreement. Through a Chapter 11 bankruptcy, the company will be able to restructure its finances and look to pay off creditors over time.
It’s unclear if the company will continue to operate during this time. Carscoops has reached out to Classic Recreations seeking additional clarification about its immediate and long-term future.
Small Business Reorganization Underway
According to court documents, Classic Recreations is proceeding under Subchapter V for small business debtors. It’s believed to have aggregate non-contingent liquidated debts of less than $3,424,000. Additionally, the filing reveals that Classic Recreations has fewer than 50 creditors and will start to distribute funds to these creditors after it makes necessary administrative expenses.
The market for high-priced restomods has surged in recent years, and companies like Classic Recreations naturally benefited from this. Pete Vanderveen has been listed as a turnaround specialist for the company, and hopefully, will be able to turn things around.
Thanks to David from the Eleanor Mustang Fan Club for the tip!