Collins & Aikman CEO Frank Macher: A merger is possible.
The slimming down would involve selling its fabric and convertible top businesses. The fabric business accounted for 9 percent and convertible tops for 3 percent of the company's $3 billion in annualized U.S. sales.
Macher also is consolidating plants.
The other option for Collins & Aikman is a merger, he said.
Financier Wilbur Ross and Lear Corp.'s interior trim division are forming a joint venture company to bid on Collins & Aikman, which filed for Chapter 11 bankruptcy protection in May.
Ross has bought much of Collins & Aikman's $750 million bank debt, and that gives him a say in the company's reorganization plan.
The best option will become clear in the next month or so when Macher gets firm numbers on Collins & Aikman's cost-savings plan, future business and likely proceeds from the sale of the two businesses. Then, both scenarios can be compared with real numbers.
"My honest belief is that the best alternative for enterprise value will be a stand-alone business," Macher said in the Nov. 1 interview with Crain's Detroit Business, a sister publication of Automotive News. "That's just speculation right now, but we'll see which one works. I've got an open mind."
Though Lear executives and Ross have made their interest in Collins & Aikman public, Macher said he has yet to talk with them together.
"Now, I've had some sidebar discussions with (Lear CEO Robert) Rossiter," Macher said, "but I've never talked to Wilbur as of this moment. At some point, we'll get together and talk."
Plastech Engineered Products Inc., of Dearborn, Mich., also is interested in Collins & Aikman.
Macher said there are other interested parties, but he wouldn't name them.
Analysts say it's possible that Collins & Aikman can stand alone, but many questions remain.
"It's totally possible, even probable," said Clifton Roesler, managing director of investment banking firm W.Y. Campbell & Co. in Detroit. "It's a very large entity to just go away. Now, they could be parceled out, but it's possible."
Macher said the company, which went into a hastily arranged Chapter 11 with no cash, now has enough money to operate, a better handle on costs, new contracts with all its customers and new business.