Tower Gets Chapter 11 Plan Approved

Tower Automotive has announced that the U.S. Bankruptcy Court for the Southern District of New York has confirmed its chapter 11 reorganization plan and approved the sale of substantially all of the company’s assets to an affiliate of Cerberus Capital Management, L.P. All classes of creditors that voted have accepted the plan.
The company expects to close the transaction by the end of July 2007.
Tower filed for chapter 11 protection on February 2, 2005, citing lower production volumes, rising steel prices and a complex and unsustainable debt load.
To strengthen its financial position and realize opportunities for profitable, long-term future operations, the company implemented a sweeping restructuring during its reorganization process. It closed or sold 16 manufacturing plants and consolidated production into existing facilities to improve productivity.
It also negotiated settlements with all 10 U.S.-based labor unions, sold non-core businesses and diversified its customer base with international automakers.
As a result, Tower expects more than half of the restructured company’s revenue will come from its international operations.
“Today, we achieved another significant milestone in our restructuring process with the Bankruptcy Court’s confirmation of our chapter 11 plan,” said Kathleen Ligocki, Tower Automotive’s President and CEO.
“While the journey was difficult, we are pleased to have court approval of a plan that deals fairly and equitably with our various constituencies while allowing Tower to emerge as a much stronger, leaner, more agile company.
Now, backed by our new owners who have clearly demonstrated their commitment to the auto industry, we look forward to focusing on profitable growth with our customers around the world.”
Tower Automotive, Inc. is a global designer and producer of vehicle structural components and assemblies used by automotive original equipment manufacturers, including BMW, DaimlerChrysler, Fiat, Ford, General Motors, Honda, Hyundai/Kia, Nissan, Toyota, Volkswagen and Volvo.
Products include body structures and assemblies, lower vehicle frames and structures, chassis modules and systems, and suspension components.