PLYMOUTH, Mich. (AP) -- Auto-parts maker Metaldyne Corp. said Thursday it filed for bankruptcy protection and plans to restructure, as the downturn in the auto business was too much to overcome.
Metaldyne plans to sell a majority of its assets, and it said private-equity firms RHJ International and The Carlyle Group expressed interest.
RHJI holds a majority stake in Metaldyne parent Asahi Tec Corp. of Japan, which bought Metaldyne in 2007 but will withdraw its financial support after helping the company reduce about $400 million in debt.
The company, which had 2008 sales of $1.57 billion, still has long-term debt of around $600 million.
"Unfortunately, despite this significant debt reduction, the impact from the macroeconomic environment of declining industry volumes, a tight credit market and the uncertainty in the marketplace were simply too large to overcome" without a bankruptcy restructuring, said Metaldyne Chairman and Chief Executive Thomas A. Amato.
Metaldyne filed for Chapter 11 protection in the U.S. bankruptcy court in New York. The filing doesn't include operations outside the United States.
The company said that to keep operating, it secured an $18.5 million in debtor-in-possession financing from Deutsche Bank AG and funded by some customers.
RHJI expressed interest in buying some of Metaldyne's operations in North America and Europe for up to $25 million in cash, the payment of $20 million in debt owed by Metaldyne's German subsidiary, the issuance of $50 million in debt by the new company, and the assumption of other unspecified liabilities. RHJI pledged to inject additional cash into the business to meet short-term needs, Metaldyne said.
Carlyle would buy some of Metaldyne's chassis business in the United States, Mexico and Spain.
Plymouth-based Metaldyne said the bankruptcy filing came despite other efforts to restructure over the past 17 months, including cutting costs by $100 million a year and paying down debt.
The company makes metal parts for car and truck powertrains, transmissions, axles and noise control. It has more than 4,400 employees in 14 countries.