Plymouth-based Metaldyne, which supplies metal auto parts to several large automakers, including Chrysler, Ford, GM, Honda, and Toyota, is a subsidiary of Asahi Tec. Asahi Tec, which is a Japanese auto parts maker, said it is not part of the filing. As it files for Chapter 11 protection, Metaldyne has debts totaling $929 million.
RHJ International, which owns 60 percent of Asahi Tec, and Carlyle Group, a private equity firm, have submitted letters of intent to purchase portions of Metaldyne's assets. Going forward, Asahi Tec will not continue its support of Metaldyne.
Former Ford subsidiary Visteon filed for bankruptcy protection in Delaware, where it reported total assets of $4.58 billion and total debts of $5.32 billion. Visteon, which continues to be Ford's biggest supplier, says it will continue operations during the bankruptcy period.
"Visteon is taking this step to maximize the long-term value of the company," said Visteon CEO Donald Stebbins in a statement. "During the reorganization period, we will seek to address our capital structure and legacy costs that are not sustainable given the current economic environment."
Visteon also said Ford has committed to debtor-in-possession financing for the restructuring effort and to ensure the parts maker continues to make parts. Ford had already assumed a $163-million revolving credit facility from Visteon's lenders. Visteon's bankruptcy has triggered fear that Ford could follow its parts maker into Chapter 11 if it tries assumes too much financial responsibility.
"Ford's top priority is to ensure we have sufficient parts and material to protect our production," said Ford Global Purchasing Group Vice President Tony Brown in a written statement.
"Because Visteon is an important, preferred supplier to Ford, we have committed to providing financial support to help Visteon meet its business challengers," Brown said.
Ford accounts for at least one-third of Visteon's sales, buying parts for the Fusion sedan, F-150 truck, and Flex crossover. Hyundai is the next biggest buyer, supplying almost another one-third of Visteon's sales.
It was unclear how long either company would stay in bankruptcy. An expedited bankruptcy process, similar to what Chrysler is now asking for, is unlikely for either Metaldyne or Visteon. Former GM subsidiary Delphi, another parts maker, has been in bankruptcy since 2005.
Sources: Reuters, The Wall Street Journal