January 31, 2007 — A federal bankruptcy court in Indianapolis has ruled Amcast Industrial Corp. may deliver its liquidation plan to creditors, rejecting General Motors Corp.'s objection based on a provision in the plan that creditors may sue GM for as much as $52 million in payments. Amcast, of Fremont, IN, filed for Chapter 11 creditor protection in December 2005, just a few months after emerging from a prior bankruptcy reorganization.
GM had been one of the largest customers for Amcast's cast aluminum wheels, but the company claims it lost up to 80% of its sales when GM shifted its purchases of wheels for the Chevy Corvette and Pontiac Solstice to a Chinese supplier.
In December 2006, Amcast sued GM over the lost business, and agreed with its creditors and lenders on terms that allow them to collect payments made to GM in the resolution of the previous bankruptcy.
Amcast closed its plants in Fremont and Gas City, IN, after in 2006,, and recently retained a realtor to locate a buyer for its Cedarburg, WI, plant.
With the liquidation plan in place and GM's objection now dismissed, the court set March 15 for a closing on creditors voting on the liquidation and a disclosure statement describing Amcast's plan for paying creditors. A hearing to confirm the plan has been scheduled for April 9.