CONTECH, LLC Enters Final Phase of Restructuring Effort

Fri Jan 30, 2009 4:45pm EST

* Reuters is not responsible for the content in this press release.

PORTAGE, Mich.--(Business Wire)--
CONTECH, LLC today announced that it and its domestic subsidiaries have
voluntarily filed a petition under Chapter 11 of the U.S. Bankruptcy Code,
commencing a reorganization proceeding. The filings were made today in the U.S.
Bankruptcy Court for the Eastern District of Michigan. The move, which was made
with the support of CONTECH`s key customers, will make it possible to relieve
CONTECH`s strong underlying operations from significant debt obligations, sell
certain non-core operations and address the unprecedented low volumes in the
North American automotive industry by rationalizing its operational cost

CONTECH is conducting normal business operations, and remains focused on serving
its customers. In accordance with the Bankruptcy Code, suppliers are expected to
be paid in full and under normal conditions for all goods and services provided
after today's filing. 

CONTECH has filed various motions with the Bankruptcy Court designed to ensure
that the company can continue to meet its obligations to its employees,
suppliers and other creditors and ensure that there is no interruption in its
business operations. Accordingly, the Company believes that the Chapter 11
filing should not impact its day-to-day operations. 

To fund its continuing operations during the restructuring, CONTECH is in
discussions with its lenders and key customers to arrange interim financing. We
expect to conclude those negotiations shortly. Subject to Court approval, the
Company intends to utilize such capital, in addition to cash flow from
operations, to fund its operations during its Chapter 11 reorganization process.

"This action is an integral part of our ongoing efforts to restructure CONTECH
and meet the challenges of the automotive industry going forward. We continue to
work closely with our lenders and customers to reach a consensus on the
remaining changes that are necessary," said Morris Rowlett, Chairman & Chief
Executive Officer of CONTECH, LLC. 

"Over the past year, we have faced the same challenges many of our competitors
and colleagues in the automotive industry have faced resulting from
significantly reduced production levels at our largest customers." Rowlett
confirmed that the Company "expects to proceed quickly and intends to emerge
from these proceedings this year with a significantly improved balance sheet and
greater operating flexibility. During this period, we will work closely with our
suppliers and customers to ensure their continued satisfaction. I am grateful
for the steadfast support of our customers, suppliers, and of our employees
throughout the entire process and I am confident in CONTECH`s strong
fundamentals going forward." 

The company has engaged Huron Consulting Group and Paul Hastings as its
financial and legal advisors, respectively, to help it through the bankruptcy
process. Additional information about the case can be found at 

CONTECH is a market leading supplier of highly engineered, geometrically
complex, light-weight cast component solutions for automotive OEM`s and Tier I
suppliers. CONTECH also manufactures safety critical steel forged automotive
components and steel tube fabrications through its Steel Products Group
primarily for commercial truck OEM`s. CONTECH is headquartered in Portage, MI
and has approximately 1,000 employees. The Chapter 11 filing affects only its
U.S. companies. The company`s operations in the United Kingdom are not included
in the Chapter 11 filing. 

Ralph Turner

Copyright Business Wire 2009