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September 3, 2009

USA: Hayes-Lemmerz reaches agreement on reorganisation

Hayes Lemmerz International has reached an agreement with its lenders and unsecured creditors on the terms of a plan of reorganisation. The wheelmaker said bankruptcy court had approved the company’s disclosure statement incorporating the terms of the agreement.

Hayes Lemmerz International has reached an agreement with its lenders and unsecured creditors on the terms of a plan of reorganisation. The wheelmaker said bankruptcy court had approved the company’s disclosure statement incorporating the terms of the agreement.

The approval allows the firm to move forward in soliciting acceptances of the plan. The hearing to confirm the plan has been scheduled for 15 October, the company said in a statement. Approval would clear the way for the Northville, Michigan-based company to emerge from bankruptcy.

Unsecured creditors dropped demands to investigate the relationship between senior managers of Hayes Lemmerz and the lenders that funded its bankruptcy, which helped to end a two-month fight over the company’s reorganistion.

The providers of the bankruptcy financing, including Deutsche Bank and General Electric Capital, will end up with the majority of the reorganised company under the company’s proposed plan. The company has also requested an incentive plan for senior managers.

The firm amended its reorganisation plan last month to sweeten the payout for creditors, who have argued that the company undervalued its assets.

Chairman and chief executive officer Curtis Clawson said: “We look forward to emerging from our restructuring as a leaner, stronger competitor well positioned to continue our leadership in the global wheel market. Our strategy remains intact: extend our lead in high-growth regions of the world in each of our major market segments – aluminium wheels, steel wheels and commercial highway wheels. Our customers and suppliers will see no change in our business during or following our restructuring.”

The company also said it remained on track with its other restructuring goals and was taking steps to address its pension and retiree medical liabilities. It is in negotiations with representatives of its retirees and the Pension Benefit Guarantee Corporation and is optimistic that it will reach agreement to reduce these liabilities.

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