The German operations of Venture Industries Corp.'s European subsidiary have entered bankruptcy and are seeking financial help from their automaker customers.
Management with Peguform GmbH said the firm lost a line of credit May 8, leaving it short of the cash needed to pay suppliers, and forcing it to file for protection from creditors, a system similar to Chapter 11 in the U.S. Bankruptcy Code.
A trustee for Peguform is scheduled to meet June 4 with representatives from European carmakers in Frankfurt, in search of more than 1 million euros (US$938,000) in support, management representative Axel Schule said at a May 31 news conference.
Executives with Peguform's parent, Fraser, Mich.-based Venture, have said little about the actions affecting the seven Peguform plants, claiming the situation is too sensitive, but said they might comment in the next few days.
``The situation in Europe is under review,'' said Michael Alexander, chief financial officer for privately owned Venture.
Peguform of BÃ¶tzingen, Germany, has more than 20 plants, with other operations in France, Spain, England, the Czech Republic, Mexico and Brazil. The bankruptcy filing does not include Peguform plants outside Germany.
Venture, a molder of interior and exterior components including bumper systems, purchased Peguform in 1999 for $445 million. The buyout gave Venture a company similar in size and production, along with a global reach.
Venture listed profit of $1 million for 2001 on sales of $1.8 billion, compared with profit of $9 million on sales of $1.8 billion in 2000. Its quarterly report, filed May 15 with the Securities and Exchange Commission, noted profit of nearly $9.2 million for the first quarter of 2002 on sales of $462.1 million, compared to a loss of $5.2 million on sales of $486 million a year earlier.
Peguform has not lost any contracts with automakers, officials stressed. It retains a strong business portfolio that includes overseeing the total interior production for Porsche's Boxster and 911 cars, along with a growing production line for front-end systems.
In 2000, it formed the Matra Venture Composites joint venture with French manufacturer Matra Automobile of St. Quentin en Yvelines, part of Lagardere group, to specialize in thermoset composite automotive bodies.
In 2001 it joined with Export Corp. SL of Barcelona, Spain, to create Venture Expert Automotive Systems to produce front-end systems. In October, Peguform purchased the automotive division of Mitras Industry Holdings Co., with composite production in Rastatt and Weiden, Germany, and Chodov Plan , Czech Republic, as part of its European expansion strategy.
``In the two years since the acquisition, we have been able to strengthen our market presence considerably,'' Peguform Chief Executive Officer Mike Torakis said in a company interview posted Nov. 1 on the firm's Web site.
Klaus-Dieter Floerecke, staff reporter for Plastics News sister publication Automobilwoche in Oberpfaffenhofen, Germany, contributed to this report.