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Delair's Shapes/Arch files for bankruptcy

The slowing economy and falling vehicle and construction sales have pushed Shapes/Arch Holdings L.L.C., a Pennsauken maker of truck, construction and hardware parts, to file for federal bankruptcy protection.

The slowing economy and falling vehicle and construction sales have pushed Shapes/Arch Holdings L.L.C., a Pennsauken maker of truck, construction and hardware parts, to file for federal bankruptcy protection.

Shapes/Arch, which made the Chapter 11 filing in Camden on Sunday, said all its divisions would continue operation. It has more than 1,000 employees at plants in Delair and Bensalem.

"It's business as usual," chief executive officer Stephen Grabell said. "We anticipate having lots of support from our vendors" who are the major creditors.

Shapes/Arch reported sales of $274 million last year, down from $322 million in 2006, wiping out most profits and leaving it unable to stay current on its bills, according to one of its court filings.

The company's existing lenders - CIT Group Inc., JPMorgan Chase & Co., and Textron Corp. - agreed to lend it up to $60 million. But Shapes/Arch needed even more.

Versa Capital Management Inc., Philadelphia, agreed to invest up to $25 million in exchange for 80 percent of the voting control during the reorganization, if the court approves the plan, according to the filings.

Versa, which invests in troubled companies, was formerly called Chrysalis Capital Partners. It is an affiliate of Independence Capital Partners, a Philadelphia investment group founded by Ira Lubert and his partners. Investors include Pennsylvania's state workers' and teachers' pension systems.

Shapes/Arch's subsidiaries include Shapes L.L.C., with more than 600 workers at an aluminum-fabrication plant in Pennsauken's Delair section. Its sales fell last year because of the "economic downturn" that has reduced Shapes' markets for trailer, truck body and railcar sales, according to the bankruptcy filing.

Subsidiary Delair L.L.C. makes aluminum fencing and above-ground pools at a plant next door to Shapes. Sales fell last year because of lower consumer spending.

Another subsidiary, Accu-Weld L.L.C., makes vinyl windows and doors in Bensalem. Sales fell because of "the general decline of the housing market."

Ultra L.L.C., which imports hardware from China through a Pennsauken warehouse. Profits are falling because of higher import costs.