By Rhoda Miel, UT Akron Bureau
Detroit, Michigan- Bankrupt autosupplier Collins & Aikman Corp. is reshaping its operations in a plan thatis likely to break up North America's largest injection moulder.
The company, which has beenoperating under Chapter 11 protection under the US Bankruptcy Court in Detroitsince May 2005, issued its latest reorganisation plan 22 Dec. The plan confirmsthe company's intention to sell off its holdings, but officials noted thatexecutives expect to split up the operations that turned out an estimated $1500million in moulded parts in 2005.
"To maximise the assets for thecreditors, what we've had to do is find logical ways of breaking down theholdings," said David Youngman, vice president, communications in a 27 Dectelephone interview. "That may be [splitting them up] by product or by customeror by geographic region."
The company's parts are likely to beworth more than the firm is as a whole, he said. A prospective buyer may wantonly plants that make air ducts, or may want a facility that turns out floorconsoles or one making parts for a specific customer or something in thesouthern US states-and those buyers are not willing to turn in a bid for everyfacility."We are in the process of [talking]with bidders for portions of the injection molded side of the business,"Youngman said. "There are many interested parties - both strategic andfinancial."
Southfield, Michigan-based Collins& Aikman has already shed its automotive fabric business, and hasidentified a lead bidder for its carpet and acoustics operations, though it hasnot disclosed that bidder's name.
Breaking up the injection moulding -which covers more than a dozen plants and an estimated 560 presses - means thesale process for those facilities will take longer than the carpet businesswhich is being sold as a complete unit. In the meantime, customers have agreedto support C&A financially to ensure a steady delivery of parts.