Lear proposes "mutually beneficial" transaction with Collins & Aikman

New York, Aug. 16 - Lear Corp. said it is interested in discussion a possible "mutually beneficial" transaction with bankrupt Collins & Aikman Corp.

The Southfield, Mich., maker of auto interiors said it has already hired financial, legal and other advisors to look at the possibility of doing a deal.

In a letter to Collins & Aikman's president and chief executive officer Frank Macher, Lear executive vice president and chief financial officer David Wajsgras said "one potentially attractive alternative, among others, would be to combine Lear's interior components and systems business with Lear's interiors business in a new joint venture.

Lear said it is "as well positioned as any other potential bidder to raise third-party equity financing if necessary to complete a transaction." Lear also noted it has recently announced it is considering strategic alternatives for the business concerned.

But Lear also said that if Collins & Aikman is considering a transaction - Wajsgras noted press reports that Plastech Engineered Products, Inc. has submitted an acquisition proposal - it would like to be given access to the information needed to develop a specific structure and proposal and at least the same access as is given to Plastech or any other bidder.

"Under the right conditions, we believe that Lear would be able to complete a mutually beneficial transaction within an acceptable timeframe," Wajsgras wrote in his letter, released to the public in an 8-K filing with the Securities and Exchange Commission. "Moreover, we have the industry knowledge, management infrastructure and experience to effect a smooth transition for the benefit of Collins & Aikman's customers and employees."

Collins & Aikman, a Troy, Mich.-based automotive company, filed for Chapter 11 on May 17 in the U.S. Bankruptcy Court for the Eastern District of Michigan. Its case number is 05-55927.

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