New Company Formed to Buy Metaldyne Assets

Aug. 8, 2009
Investors seek court approval to buy powertrain, chassis products
Most of the assets of Metaldyne Corp. have been sold to a newly formed company, MD Investors Corp., which submitted the highest bid for the holdings at a bankruptcy court auction. Metaldyne also petitioned the U.S. Bankruptcy Court to approve the sale of those assets. MD Investors is a new company formed by Metaldyne's existing term lenders, led by The Carlyle Group and Solus Alternative Asset Management LP. The sale includes Metaldyne's Sintered Products, European Forgings, and Vibration Controls Products operations in Europe, Asia, Brazil, Mexico, and the U.S. Plants in Bluffton, IN, Litchfield, MI, and Twinsburg, OH, are include (the last, subject to certain conditions.) Also included are Metaldyne's balance shaft module operations at Fremont, IN, and Pyeongtaek, Korea; tubular products operations at Hamburg, MI; and chassis operations in Edon, OH, Barcelona, Spain, Iztapalapa, Mexico, and Greensboro, NC (subject to certain conditions, operations.) The automotive parts producer filed for Chapter 11 bankruptcy in late May, citing an unmanageable debt load, weak automotive industry demand, and a lack of available credit to maintain its organization. At that time, Metaldyne was written off by its merger partner, Japanese parts maker Asahi-Tech Corp. The proposed sale would be a “363 sale” — a bankruptcy law provision that allows the sale as a going concern basis before a reorganization plan is approved. "We are very pleased Carlyle, Solus, and a group of our term lenders have agreed to purchase substantially all of Metaldyne's businesses," stated Metaldyne chairman Thomas A. Amato. "It has always been our plan to divest our better performing operations in connection with our overall Chapter 11 restructuring. We believe the sale of these businesses as a going concern represents the best way to continue to serve our customers and preserve as many jobs as possible.”