Another LBM giant has stumbled. Lyman Lumber Co., No. 21 on the latest ProSales 100 listing, has begun Chapter 11 bankruptcy proceedings and entered into a letter of intent to sell its Midwest operations to SP Asset Management LLC. That's an affiliate of Steel Partners Holdings L.P., a New York City-based global diversified holding company.

The company has $100.3 million in debt with assets of just under $15.5 million, it told a bankruptcy court last month. Lyman also reported 2011 revenue through early August totaling $15.4 million. That puts the company far off the pace that enabled it to collect $37.4 million in revenue all of last year.

Among the company's largest debtors are U.S. Bank, Central States Pension Fund, and TCF National Bank.

Lyman operates six Midwest divisions that cater to professional contractors and lumber dealers by supplying building materials and jobsite labor.

"Although we are very involved in this reorganization, our primary focus is on our customers and we do not anticipate any disruption in service. In fact, it will appear like business as usual to our customers," Lyman president and CEO Jim Hurd said in a statement.

Hurd said the sale will allow Lyman Lumber to unload some of its non-performing assets and services and work to secure long-term financing needed to help the company grow. Hurd said the company's construction lending portfolio and financial commitments related to its land holdings were the two largest strains on the firm and will be part of the assets divested.

"We are excited to have the opportunity to acquire Lyman Lumber," says Steel Partners' president, Jack Howard. "They have an outstanding brand, operation and staff. Despite the impact the housing crisis has had on Lyman, we believe that with its strong relationships with customers, suppliers and employees, and strong capital partner, Lyman would be well positioned to succeed in the future."