UPDATE 1-Cooper-Standard emerges from bankruptcy

* Emerges with $650 million less debt

* Exits bankruptcy as auto industry turns around

By Tom Hals

WILMINGTON, Del., May 27 (Reuters) - Cooper-Standard Holdings Inc said it emerged on Thursday from a 10-month bankruptcy during which the maker of automotive systems shed $650 million of debt.

The company emerged under the control of bondholders, who swapped their debt for equity in the reorganized company.

The Novi, Michigan-based company employs about 16,000 workers worldwide and makes door, body and sunroof seals, as well as systems that move fuel and brake fluid throughout a vehicle.

Cooper-Standard emerged from bankruptcy as the automotive industry has undergone a sharp reversal of fortunes from a year ago, when General Motors and Chrysler stumbled into Chapter 11 and dragged down numerous parts makers in their wake.

Another bankrupt auto parts maker, the once-ailing Visteon Corp VSTNQ.PK, has been generating such strong cash flow and profits it has set off a fight for the company among creditors, shareholders and Johnson Controls Inc (JCI.N).

Cooper-Standard used $355 million in new equity, $450 million in new bonds and $125 million in new loans to pay off creditors and fund operations.

The new equity plan is being backstopped by funds associated with American Funds, Oak Hill Advisors, Silver Point Capital, TCW Group, Barclays Capital and Lord Abbett, among others.

The funds would end up with preferred stock and warrants that, if converted to common equity, would give them more than 20 percent of the company.

The bankruptcy wiped out the investments of the previous co-owners: GS Capital Partners 2000 LP, a subsidiary of Goldman Sachs Group Inc (GS.N) and The Cypress Group LLC, a New York-based private equity firm, according to court documents.

The case is in re Cooper-Standard Holdings Inc, US Bankruptcy Court, District of Delaware, No. 09-12743. (Reporting by Tom Hals; editing by Andre Grenon)