Collins & Aikman inks plastics division deal

NEW YORK (CNNMoney.com) -- Bankrupt car parts maker Collins & Aikman said Monday it had signed an agreement to sell a significant part of its plastics division to rival Cadence Innovation.

Because Collins & Aikman (Charts) is liquidating under Chapter 11, the deal must be approved by bankruptcy court. The division could instead be auctioned if the company receives competing offers.

Cadence Innovation announced its intention to acquire the plastics division in March.

The portion that Collins & Aikman is selling includes nine facilities in the U.S., Canada and Mexico that employ 3,500 people and make products for North American automakers.

"Moving this transaction forward is particularly noteworthy as we work towards our exit from bankruptcy," said John Boken, Collins & Aikman's chief restructuring officer, in a statement.

Cadence Innovation makes doors and cargo systems, and acquired many of its key assets from bankrupt Venture Holdings several years ago.

Cerberus leads Tower Automotive bids