Exterior body-module specialist Meridian Automotive Systems is considering going public, with a possible initial public offering of as much as $150 million in stock.
The Dearborn, Mich., company registered Aug. 20 with the Securities and Exchange Commission. The company said it would use IPO proceeds, plus a planned $250 million bond offering, to reshape its debt.
Debt has made a dent to Meridian's bottom line. The company posted a 2001 gross profit of nearly $67 million on sales of $976.7 million, but debt costs pushed it into a net loss of $57 million. Meridian last posted a net profit in 1999, before it paid $337 million for the assets of Cambridge Industries Inc.
That deal made Meridian a top supplier of exterior composites.
Meridian officials did not set an IPO date and declined comment. The move appears to be an ``old-style IPO,'' aimed at improving the balance sheet and preparing for more flexibility in future growth, noted Philip Gilbert, managing director of P&M Corporate Finance LLC, of Southfield, Mich.
Although manufacturing companies are not hot commodities on Wall Street, most also have held steady over the years.
``The market for auto suppliers is not what you'd call buoyant, but it hasn't been terrible,'' Gilbert said.
Meridian has been active with acquisitions since financial group Windward Capital Partners LP financed the launch of the company through the purchase of American Bumper & Manufacturing Co. in 1997. It took on plastics processing in 1998 with a $35.9 million stake in Lorro Inc., a producer of bumper energy absorbers.
It followed that up in 1999, first with a $184.3 million purchase of Lescoa Inc., an interior and lighting plastics maker in May, and a $12 million purchase of SAI Automotive USA's Kansas City, Kan., plant with its bumper fascia systems.
The Cambridge purchase brought extensive capabilities in exterior plastics, allowing the company to chase contracts for complete front- and rear-end modules, composite pickup truck boxes and truck tonneau covers.