DETROIT --Meridian Automotive Systems Inc. plans to sell and lease back its plant in Fowlerville, Mich., and sell some or all of its interior division and issue lien notes so it can emerge from Chapter 11 bankruptcy.
Meridian, of Allen Park, Mich., filed its proposed plan of reorganization on Thursday, March 30, in U.S. Bankruptcy Court in Delaware.
Meridian Automotive, which makes instrument consoles, hoods, roofs and bumpers, filed for Chapter 11 bankruptcy April 26, 2005, after suffering from rapid price increases for steel and plastic.
Meridian expects to gain $18.3 million from the sale of the Fowlerville plant to First Industrial Acquisitions Inc., according to its plan of reorganization. First Industrial will lease the plant back to Meridian, which will continue to operate it.
Chicago-based First Industrial Realty Trust Inc. is the nations largest provider of diversified industrial real estate, according to its Web site. The company leases, develops and sells industrial plants.
Meridian also said any money received from the sale of all or part of its interiors business will be used to pay creditors. Meridians interior products are made at three plants in Grand Rapids, Mich.; a plant in Brantford, Ontario; and a plant in Muzquiz, Mexico. Finally, Meridian plans to issue up to $150 million in lien notes to creditors.
Meridians plan was proposed both by the company and several hedge and investment funds that hold portions of Meridians secured debt. Company officials and three attorneys for Meridian and its funds could not be reached for comment on Friday, March 31.
Filing a plan in less than eleven months since entering Chapter 11 is a major accomplishment and clearly reflects the strength of our company and our efficiency with respect to our restructuring efforts, said Richard Newsted, Meridians CEO, in a statement. Our restructuring process is now entering into its critical final stage, and we are committed to completing our exit from Chapter 11 as quickly and efficiently as possible.