Brightmark , the plastics recycling company planning to locate a billion dollar plant at the Biz Tech Park at the Thomaston Upson airport has issued a statement after Bloomberg News reported an Indiana plastics company associated with Brightmark had defaulted on $170 million of Muni Green Bonds. In an email brightmark spokesperson Chrystal Boone told 101 news the company is aware of the bond default issue in Indiana and it is specific to the Ashley facility and does not impact other parts of the business including in Thomaston. Ms. Boone said Brightmark will have more to share about this in the next few days. Brightmark plans to fund the Thomaston plant with just under $1 billion in bonds from the Thomaston Upson IDA.
Bloomberg reported Brightmark plastics renewal Indiana LLC defaulted on a March 1st payment on bonds issued through the Indiana Finance Authority, according to a securities filing. UMB Bank, the trustee for the bonds, declared the principal and accrued interest on the debt due and payable immediately.
Located in Ashley, Indiana, the plant--which converts everything from beverage bottles to car seats into fuel and wax is a flagship facility of Brightmark Energy, a San Francisco-based waste-to-energy company. The company's bonds last traded at about 16 cents on the dollar on Feb. 10.
According to Bloomberg News reporter Martin Braun, construction delays, lower-than-expected demand and ballooning costs of production due to inflation have plagued all recycling projects; about $1 billion of the $9.3 billion in so-called green municipal industrial development bonds are in default.
Many of the companies issued risky, unrated bonds in a period of low interest rates that sparked strong demand for higher-yielding assets. The Brightmark Plastics bonds were issued in late March 2019. High yield Muni bonds finished that year with a return of 10.7%, according to Bloomberg’s high yield Muni index, driven by strong fund flows and low interest rates.
Returns stood at 6.3% in 2024, compared to 1.1% for investment grade Munis.
Alliance/Bernstein Holding LP Funds was the largest holder of the bonds, with about $56 million as of Jan. 31, according to Bloomberg. Pacific Investment Management Co. Held $50 million as of Dec. 31.
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