Visteon files for Chapter 11
Auto parts supplier files for bankruptcy protection for its U.S. business. Company plans to keep operating through reorganization.
BANGALORE (Reuters) -- U.S. auto parts maker Visteon Corp said on Thursday it had filed for Chapter 11 bankruptcy protection for its U.S. operations.
The Michigan-based company's unsecured creditors include a unit of Bank of New York Mellon Corp. (BK, Fortune 500) holding bond debts, the Pension Benefit Guaranty Corp and IBM (IBM, Fortune 500), which is a trade creditor. Visteon said it filed certain customary "first day motions" with the court to ensure a smooth transition into Chapter 11.
"During the reorganization period, we will seek to address our capital structure and legacy costs that are not sustainable given the current economic environment," Visteon Chief Executive Donald Stebbins said in a statement.
No Visteon subsidiaries or joint ventures outside the United States are part of the filing, the company said, adding that it would continue its operations throughout the reorganization process.
Visteon, which Ford Motor Co. (F, Fortune 500) spun off in 2000, said the car maker had made a commitment to support debtor-in-possession (DIP) financing for the restructuring efforts and to ensure long-term continuity of supply.
Ford is still Visteon's biggest customer and accounted for about 31% of its $1.35 billion of sales last quarter.
Earlier this month, Ford assumed a $163 million secured revolving credit facility from Visteon's lenders
The health of the U.S. auto parts supply base has been a priority for Ford with Chrysler in bankruptcy and General Motors Corp. (GM, Fortune 500) close to a government-imposed deadline to restructure or follow Chrysler down that road.