Intermet Corp. has gained the approval of the federal court overseeing its reorganization for an equity-financing plan it proposed. The letter of commitment from R2 Investments LDC and Stanfield Capital Partners LLC calls for those two private-equity firms to underwrite the recapitalization of Intermet with a $75 million investment of equity.
Troy, MI-based Intermet declared bankruptcy in September 2004. A previous equity plan involving R2 Investments and Stanfield Capital Partners was rejected by the same court in July.
"We are pleased with the court's approval, which means that Intermet is moving closer to exiting bankruptcy," said Intermet chairman and CEO Gary F. Ruff. "We look forward to emerging from Chapter 11 with a capital structure and strategy designed to strengthen our leadership position in the industry."
The court also approved Intermet’s amended disclosure statement, as well as its proposed solicitation and balloting process. Intermet will distribute the disclosure statement and balloting materials to all creditors to solicit support of the plan.
The court will hold a confirmation hearing on the reorganization plan on September 26, 2005.