Avon Automotive gets cash injection and new owners

ERJ staff report (DS)

Cadillac, Michigan -- Avon Automotive Holdings Inc. and its subsidiaries have completed a refinancing and recapitalisation that has substantially reduced the company's debt and improved its capital structure.

As part of the recapitalisation, Crystal Capital of Boston, Massachusetts contributed new equity and becomes the majority equity holder by acquiring the shares held by Red Diamond Capital and MC Capital Inc. The senior loan syndicate, led by Jefferies Finance LLC, amended its existing loans to provide for increased borrowing availability and reduced amortisation. Red Diamond Capital, MC Capital Inc. and Jefferies Finance LLC are all based in New York. Additionally, support from major customers in North America and Europe contributed to the execution of the recapitalisation.

“This recapitalisation provides us with a significantly improved balance sheet and is an integral part of our strategy to meet the challenges faced by our industry,” said Lee Richards, president and CEO of Avon Automotive. “We very much appreciate the enormous support from our customers, lenders, equity owners and suppliers, along with important sacrifices by our employees.”

“While market conditions continue to be challenging, we have gained significant new business that will be launched across the company in 2009,” said William Dircks, CFO of Avon Automotive. “This will enable growth of the business as the market recovers.”

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Press release from Avon Automotive