DETROIT -- Auto frame and chassis supplier Tower International Inc. said Monday it has acquired substantially all of the assets of metal parts supplier W Industries Inc. for an undisclosed sum.
Terms of the deal, which closed Monday, were not made public.
W Industries had been shopping for a partner under pressure from its largest debtor, JPMorgan Chase, which held nearly $25 million of W Industries' debt, sources familiar with the deal told Crain's Detroit Business, an affiliate of Automotive News.
The Detroit-based supplier needed an investor or faced an asset sale -- which is when Tower stepped in to acquire the debt from Chase and become the new owners, sources said.
W Industries posted 2010 revenue of about $65 million and employs about 250, Tower said in a statement.
Derek Fiebig, Tower's executive director for investor and external relations, declined to discuss details about W Industries' revenue or clients.
W Industries, founded in 1981, was, for its first 20 years, a middle-market, family-run business supplying welded metal components to the auto industry. Sales to Ford Motor Co. at one point accounted for about 95 percent its business until it began a diversification program into aerospace, defense and alternative energy in the early 2000s.
For Tower, based in suburban Detroit, the deal represents its first major move after emerging from bankruptcy in 2007 and then going public last year.
"This bolt-on acquisition fits perfectly with Tower's stated game plan to expand smartly into the adjacent defense, aerospace and industrial markets," Tower Chairman Nick Chabraja said in a statement.
In October, Tower raised $77 million in an initial public offering, devoting $58.5 million of that to lower the outstanding balance of its revolving debt.
Before the IPO, Tower had been privately held by former Chrysler owner Cerberus Capital Management L.P. since the New York private equity firm bought the supplier out of Chapter 11 bankruptcy in the summer of 2007 in a $1 billion deal.
Cerberus retained 12.47 million shares and remains Tower's majority shareholder. Tower filed for Chapter 11 in 2005 because of declining auto production volumes and rising steel prices.
Tower reported a net loss of $21.3 million on revenue of $541.6 million for the fourth quarter, which ended Dec. 31. That compares with a net loss of $19 million on revenue of $501 million during the same period a year ago.
For the year, Tower reported a net loss of $36.9 million on revenue of $2 billion, compared with a net loss of $67.9 million on revenue of $1.6 billion in 2009.
Tower's customers include Volkswagen AG, Fiat S.p.A., and Ford.
