DETROIT -- Car seat leather supplier GST AutoLeather Inc. emerged from Chapter 11 bankruptcy Tuesday under new private equity ownership and leadership.
The supplier based in suburban Detroit is majority-owned by Black Diamond Capital Management LLC.
Black Diamond hired Randy Johnson, former president and CEO of composites supplier Romeo RIM Inc., to lead the GST as its CEO. Before Romeo RIM, Johnson served as vice president of global operations for GST competitor Eagle Ottawa before it was acquired by Lear Corp. in 2015.
Johnson replaces Dennis Hiller in the role. Hiller will remain a board adviser for an unspecified period. The company also hired Bryn Kahl, former vice president of operations for German pneumatic components supplier Aventics, as its vice president of global operations and Scott Landis, former president of NorthSand HR Group LLC, as its chief human resources officer.
GST AutoLeather entered bankruptcy on Oct. 4, saddled with $196 million in debt despite revenue of $540 million in 2016, according to its filing in U.S. District Court in Delaware. At the time, the supplier blamed the rise of ride-sharing and reduced auto production for its decline.
But GST suffered more practical business setbacks at its foreign operations -- the company employs 5,600 in the U.S., Mexico, Japan, China, Korea, Germany, Hungary, South Africa and Argentina.
GST said in its bankruptcy filing that between April 2016 and July 2017 about 20 percent of its supplied content to an automaker in Europe was rejected due to one of its suppliers' violation of the automaker's validation process. The problem cost GST about $8 million, it said in the bankruptcy filing.
GST generated $142 million in revenue in Europe in 2016.
A leather tannery in China also began demanding above-contract pricing in late 2015, costing GST an additional $24 million to move capacity elsewhere, the filing said.
Before bankruptcy, GST was owned by Tokyo-based private equity firm Advantage Partners LLP, which acquired the supplier for $310 million from Citibank Venture Capital and its affiliate SILLC Holdings in 2008. Advantage entered into an agreement to sell GST to private equity firms MBK Partners of Hong Kong and Simone FC Co Ltd. of South Korea in 2015 for $400 million, but the deal never materialized.