January 16, 2007 — Metaldyne Corp. reports that its $1.2-billion merger with Asahi Tec Corp. has been completed, several weeks after the original target date. As previously announced, Metaldyne will operate as a subsidiary of Asahi Tec and keep its brand name, and TIm Leuliette will continue as chairman and CEO, and ecomes co-chaiman of Asahi Tec with Shoichiro Irimajiri. Asahi Tec CEO Akira Nakamura will be co-CEO of Asahi Tec with Leulliette.
The merger was announced in September, but delayed in November as Metaldyne creditors sought a greater equity offering from Asahi Tec. In the end, Asahi Tec agreed to invest $205 million of equity in Metaldyne, and Metaldyne's existing credit and receivables facilities are being refinanced with new credit facilities of $670 million — including a $460-million term loan facility of which $25 million will be available on a delayed-draw basis after the merger. About 97% of Metaldyne's equity holders agreed to reinvest their proceeds in new Asahi Tec common stock.
The plan is to form a global manufacturer of engineered automotive components: Metaldyne produces parts for powertrain and chassis systems; Asahi Tec manufactures ductile-iron and aluminum castings for components supplied to automotive, truck, and construction equipment builders. It also produces aluminum automotive wheels.
With Metaldyne, Asahi Tec will offer its customes a wider geographic base and product portfolio it describes as “highly-engineered, precision modules, and components for powertrain and chassis.” Presently, the group is concentrated in Japan, with operations in Thailand and China. Metaldyne’s operations are spread across North America, Europe, Korea, and China, and it is expanding in India and Brazil.
“Globalization has changed the world,” stated Leuliette. “Metaldyne and Asahi Tec have responded by creating a new paradigm for the auto industry. We have combined to form a strong, globally competitive company that understands and supports global markets, cultures and customers and delivers leading-edge products worldwide.”