PLYMOUTH, Mich., May 30 /PRNewswire/ --
Metaldyne Corporation today announced it has received court approval on its interim debtor-in-possession (DIP) financing motion which allows the company to access $18.5 million in new funding from Deutsche Bank AG, New York through funding commitments of certain Metaldyne customers. The DIP credit facility will be used for the company's normal working capital requirements, including supplier payments, employee wages and benefits, utility and lease payments, and other operating expenses during the reorganization process.
Metaldyne expects this financing facility will provide it with sufficient funding to complete the expedited sale of a significant portion of its assets.
As part of its Chapter 11 filing Metaldyne announced that RHJ International (RHJI) and The Carlyle Group, two well-respected private equity firms, have separately submitted letters of intent to purchase different portions of Metaldyne assets. RHJI has a majority stake in Asahi Tec, Metaldyne's parent company. RHJI has expressed interest in many of Metaldyne's powertrain related operations, including certain assets in its Sintered Products, Vibration Controls, European Components and Powertrain Products divisions.
Under the bankruptcy sale process, the proposed transactions are subject to execution of definitive purchase agreements, court approval and other customary conditions. Interested parties will have an opportunity to submit higher and better offers for Metaldyne's assets.
Metaldyne's restructuring plan has met with approval from many of its customers.
"Metaldyne is an important supplier to GM," said Bo Andersson, GM group vice president for Global Purchasing and Supply Chain. "We fully support Metaldyne's restructuring efforts."
In addition to the approval of the interim DIP Financing, the Honorable Judge Glenn of the U.S. Bankruptcy Court for the Southern District of New York also approved the balance of the "First-Day Motions" that Metaldyne filed as part of its filings for reorganization under Chapter 11 of the U.S. Bankruptcy Code.
"I am pleased that the Court approved all of our First Day Motions, including our interim DIP Financing motion," said Thomas A. Amato, chairman, president and CEO. "This was an important first step in our plan towards restructuring Metaldyne by divesting the company into primarily two new companies, one powertrain-focused and one chassis-focused."
For access to certain court documents and other information about Metaldyne's Chapter 11 case, please visit www.metaldynerestructuring.com.
About Metaldyne
Metaldyne is a wholly owned subsidiary of Asahi Tec, a Shizuoka, Japan-based chassis and powertrain component supplier in the passenger car/light truck and medium/heavy truck segments. Asahi Tec is listed on the Tokyo Stock Exchange.
Metaldyne is a leading global designer and supplier of metal based components, assemblies and modules for transportation related powertrain and chassis applications including engine, transmission/transfer case, wheel end and suspension, axle and driveline, and noise and vibration control products to the motor vehicle industry.
Headquartered in Plymouth, Mich., Metaldyne had revenues in 2008 of approximately $1.57 billion. Metaldyne employs more than 4,400 employees at 33 facilities in 14 countries. For more information go to www.metaldyne.com.
Forward Looking Statement
This press release contains statements that are not statements of historical fact, but instead are forward-looking statements, as that term is defined by the federal securities laws. We caution readers not to place undue reliance on these forward-looking statements, which reflect management's expectations, estimates and assumptions based on information available as of the date hereof. Important factors that could cause actual results to vary materially from those expressed or implied by the forward-looking statements are set forth in our Annual Report on the Equivalent of Form 10-K for the fiscal year ended March 31, 2008 and our subsequent Quarterly Reports, and include: our high degree of leverage; substantial restrictions in our credit facilities and other debt; declining financial condition of our customers; risks associated with the condition of our suppliers and subsequent availability of product; adequacy of our liquidity to meet our obligations and grow our business; seasonal fluctuations in our business and impact on working capital; our industry's cyclicality and dependence on general economic conditions; inability to achieve profitability given our high degree of leverage and resulting interest expense; affordability of raw materials and components; inability to quicklyreplace any diminished or lost business due to the length of the sales process; risks related to termination for convenience provisions in certain of our customers' purchase orders and unanticipated cancellation of programs by our customers; risks associated with our parent company being controlled by a Japanese principal stockholder and therefore being subject to the regulatory environment for publicly traded Japanese companies; costs could potentially exceed estimates used in pricing our products; our employee benefit obligations may negatively impact future liquidity; risks related to international sales; inability to protect our intellectual property rights; environmental compliance obligations and liabilities; inability to meet obligations for any product liability and warranty claims; unanticipated labor stoppages at our facilities or those of our customers; general economic conditions in the market sector in which we operate, including continued volume deterioration of our top three customers, changes in interest rates or foreign currency exchanges; impact of the global financial crisis on our business and liquidity; and potential consolidation, loss or insolvency of our customers. We do not intend or assume any obligation to update any of these forward-looking statements.
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