INDUSTRY NEWS North America
Recently Sold Grede to Combine With Citation Corp. Grede Foundries Inc., Milwaukee,
will be combined with Citation Corp., Novi, Mich., during the fi rst quarter of 2010 to form a new company operating under the Grede name. “We are taking the best of the best
in people, assets and technology [from both companies],” said Citation Presi- dent and Chief Executive Offi cer Doug Grimm, who has been tapped to lead the merged companies. The announcement of the business consolidation comes a day after the sale of Grede to Wayzata Investment Partners LLC, Wayzata, Minn., was ap- proved by the U.S. Bankruptcy Court. Chris Keenan of Wayzata informed Grede suppliers of the merger in a let- ter dated Dec. 23. “We believe this transaction, which
will be facilitated by signifi cant equity investment from Wayzata and Citation’s largest shareholder, GSC Group, will create the most diversifi ed [metalcast- ing] group in North America,” Keenan wrote. “Wayzata will be the control- ling shareholder of the new company, which will operate as Grede.” The Grede businesses that will be
included in the new company are its Liberty Foundry (Milwaukee), Iron Mountain Foundry (Kingsford, Mich.), St. Cloud Foundry (St. Cloud, Minn.), Reedsburg Foundry (Reedsburg, Wis.),
New Castle Foundry (New Castle, Ind.) and Wichita Foundry (Wichita, Kan.). The deal does not include the com- pany’s Greenwood, S.C., and Vassar, Mich., plants. The Greenwood plant has been closed for several months, and the Vassar facility was sold to Revstone Industries, Lexington, Ky. Citation sold its aluminum diecasting
and machining operations in March and closed two primarily automotive plants, one in Butler, Ind., and the other in Lufkin, Texas, since undergo- ing a recapitalization in March 2007. However, the company still operates eight metalcasting plants. “Both companies have already done
quite a bit of restructuring,” Grimm said. “Grede has done it through bankruptcy, and Citation has done it [outside of bankruptcy].” The newly formed metalcasting gi-
ant will maintain 14 plants with nearly 600,000 tons of iron casting capability. In his letter, Keenan estimated the company’s future annual revenues at $575 million. “Hopefully, no more [consolida-
tion] is needed, but that is going to depend on sales volumes,” Grimm said. “Volumes and utilization will continue to be an ongoing review, but at this point, the goal is to maintain the current footprint.”
MC Hayes Lemmerz Completes Bankruptcy Reorganization
Hayes Lemmerz International Inc., Northville, Mich., announced it has emerged from Chapter 11 reorganiza- tion, which it applied for in May. The company reports that its credi-
tors voted in favor of its plan for reor- ganization, which was confi rmed on Nov. 3 by the U.S. Bankruptcy Court for the District of Delaware. Hayes Lemmerz announced in a
press release that its total consoli- dated prepetition funded indebted- ness of approximately $720 million has been reduced to approximately
10
$240 million. In addition, its legacy retiree medical and pension liabilities in the U.S. of over $250 million are expected to be less than $75 million. In conjunction with its emergence from Chapter 11, Hayes Lemmerz completed its exit fi nancing facility. The facility consists of a new $200 million term loan. “Hayes has continued to win sig-
nifi cant new business throughout the restructuring process, and we are ex- tremely grateful to our customers for their confi dence in our future,” said
Curtis Clawson, chairman and chief executive offi cer of the company. “We are comfortable that our exit fi nancing will provide us with the liquidity to fund operating expenses and meet all of our obligations.” Hayes Lemmerz produces aluminum
and steel wheels for passenger cars and light trucks and steel wheels for commercial trucks and trailers. The company operates 23 facilities, in- cluding business and sales offi ces and manufacturing facilities, in 12 countries around the world.
MC MODERN CASTING / February 2010
L A Aluminum won a contract for cast- ings that go on the ends of towable tanks used to deliver liquids to troops.
L A Aluminum Casting Co.,
Hayden, Idaho, recently fi nalized two military contracts worth more than $5 million and has installed (continued on page 12)
L A Aluminum Wins New Contracts, Adds Equipment
Visit MODERN CASTING’s Late-Breaking Metalcasting News at
www.moderncasting.com
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