Interior parts specialist Lear Corp and private equity group WL Ross & Company plan to team up and explore acquisition opportunities in the struggling sector together, according to the Associated Press (AP).
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The companies reportedly said they signed a framework agreement to form a joint venture, along with Franklin Mutual Advisers LLC, which has agreed to co-invest with Ross’s firm. Among the deals the group plans to explore is the acquisition of all or some of auto parts supplier Collins & Aikman Corp., which filed for Chapter 11 bankruptcy protection earlier this year.
Ross’s firm specialises in investing in financially troubled companies, AP noted.
“The market for interior component products is severely distressed, and we have indicated that we are actively engaged in finding a better solution for our customers and our shareholders,” Lear chief executive Bob Rossiter said in a statement cited by the news agency.
Under the agreed framework, WL Ross would contribute capital to fund acquisitions. “We see many opportunities to improve the operating fundamentals and profitably grow this business through acquisitions and restructuring actions,” Ross, CEO of WL Ross, reportedly said in the same statement.
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By GlobalDataA definitive agreement must still be signed before the companies can establish a partnership, the Associated Press noted.
