PLYMOUTH, Mich. — Metaldyne has signed an agreement to sell certain powertrain and operating assets and the stock of certain of its foreign subsidiaries as going concerns to global holding company RHJ International (RHJI) under a court-supervised sale process. The sale is subject to bankruptcy approval procedures and customary closing conditions for a transaction of this nature, including RHJI’s finalization of due diligence, which will occur by July 2.
RHJI’s also currently owns Asahi Tec Corp., Metaldyne’s parent company.
"RHJI is uniquely positioned given its global automotive supplier holdings, commitment to the automotive industry, and operating company expertise," said Thomas Amato, Metaldyne chairman, president and CEO. "We are pleased to bring this transaction to the court for consideration."
Under the agreement, a newly formed subsidiary of RHJI will purchase certain North American and all of the European assets of Metaldyne’s Sintered Products, Vibration Control Products and Powertrain Products business units, as well the European Forging Products business unit and certain Asian operations. The transaction is valued at approximately $100 million including up to $25 million in cash, a new $50 million secured note and the exchange of an existing euro 15 million demand note issued by Metaldyne GmbH for a term loan to RHJI’s newly formed acquisition subsidiary. In addition, RHJI has agreed to inject additional cash into the newly formed entity to fund future working capital needs.
"The Metaldyne operations being purchased have strong product portfolios, advanced technologies and perform well operationally. The new powertrain-focused company RHJI is creating will be a solid supplier to the restructured global automotive industry," Amato said.
As part of its May 27 Chapter 11 filing, Metaldyne entered into a letter of intent with RHJI to sell certain portions of Metaldyne’s assets as ongoing concerns. Metaldyne filed its voluntary petitions in the United States Bankruptcy Court for the Southern District of New York under Chapter 11 of the U.S. Bankruptcy Code. The filing did not include the company’s non-U.S. entities or operations.
The company also announced that additional funding from two original equipment customers increased the availability of its debtor-in-possession (DIP) financing from $18.50 million to $19.85 million. The DIP financing will be used to fund debtor operations as part of the bankruptcy process.
