by Jeffrey McCracken
Detroit Free Press Business Writer
FRASER, MI — Macomb County businessman Larry Winget, cofounder and majority owner of bankrupt auto supplier Venture Corp., has resigned from the board amid a lawsuit that alleges he and his family siphoned millions of dollars from the company. Winget’s son and son-in-law, executives with the struggling auto-plastics firm, have been placed on paid leaves of absence.
Venture, which filed for bankruptcy in March 2003, filed a lawsuit against Winget and his family in April, alleging they took $314 million from Venture by fraudulently sending money to other businesses they owned and getting little or nothing in return.
Because Venture is in bankruptcy, the law now views the company and the owner as separate parties. In effect, Venture is telling the bankruptcy court Winget must pay back the millions of dollars so that creditors can get paid and the company will have a more promising future.
At various worksites Winget posted a letter that said he had decided to leave the company.
“Now, sadly, I have come to the conclusion that it is in the best interest of Venture that I step down from the Board of Directors of the Company,” reads the letter. “I continue to work on a daily basis on reorganization alternatives and hope that a workable plan can be developed that will get us back on track.”
Winget’s lawyer, Ralph McKee, declined to comment and would not say why Winget or his family members were leaving.
“I can’t really say any more than what’s in the letter there,” said McKee. The letter added that Winget will remain a shareholder in Venture, one of the world’s largest auto-plastics firms and a crucial supplier to Detroit’s automakers. A supplier executive and lawyer familiar with Venture said Winget is trying to distance himself now so he could file suit against the company later. Lawyers for Venture declined several requests to comment on Winget’s departure.
Meanwhile, the banks and others in charge of Venture have turned down an offer from a Los Angeles private-equity firm called Yucaipa Cos. to buy Venture out of bankruptcy. Yucaipa has specialized in owning supermarkets, cafeterias and other food-related businesses. Company officials did not return a call asking for comment on their offer.
One supplier executive, one supplier financial consultant and a lawyer familiar with Venture said Yucaipa offered about $440 million, but the deal was declined because “it had too many contingencies, too many questions with it,” said the supplier executive. The lawyer said the offer was for slightly more money and the deal could be revisited later.
At its peak, Venture employed 3,000 workers globally and about 2,000 in Fraser, Troy and Clinton Township, Mich. When it filed for bankruptcy protection the company said it would pay back creditors and emerge from bankruptcy in late 2003. Lawyers and executives familiar with Venture say the company now hopes to emerge by the end of June.
Venture posted sales of about $1 billion in 2003 and is Michigan’s 16th-largest privately held company, a Free Press study found. It reported sales of up to $1.86 billion in recent years.
Venture makes products such as instrument panels and exterior plastic trim. About 85 percent of its sales are to General Motors Corp., Ford Motor Co. and Chrysler Group.
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