An automotive plastics and tooling supplier to major automakers and Tier 1 manufacturers has filed for bankruptcy after months of financial distress.
Auburn Hills, Mich.-based Unique Fabricating NA Inc. filed a petition for voluntary Chapter 7 protection in the U.S. Bankruptcy Court for the District of Delaware on Wednesday, according to a company filing with the U.S. Securities and Exchange Commission.
The company makes plastic, rubber and foam components for customers including Stellantis NV, General Motors Co., Yanfeng Automotive Interior Systems, Rivian Automotive Inc. and Bosch.
It has up to $50 million in estimated liabilities and between $10 million and $50 million in assets, according to a bankruptcy document.
NYSE American LLC announced Nov 9 that it initiated proceedings to delist the company from the stock exchange in light of the bankruptcy.
Unique Fabricating, which operates plants and warehouses in Michigan, Georgia and Kentucky as well as Mexico and Ontario, filed for bankruptcy with eight entities under the Unique Fabricating umbrella. Liquidation proceedings likely mark the final chapter for the long-troubled company, which made its initial public offering in 2015 at $11 per share. It has since lost nearly all of its value, trading below $1 per share for the past year.
The company's board decided to terminate all employees across all subsidiaries due to insufficient capital to continue operations. The company had 915 full-time and 58 contract workers as of the end of 2021, according to its most recent annual report, filed in March 2022. About half of the employees were in the U.S.
The company paid Delaware-based Young Conaway Stargatt & Taylor LLP $674,672.19 to serve as its counsel. Crain's Detroit Business a sister publication of Plastics News, inquired with the firm for more information.
Unique Fabricating disclosed in April that it was facing insolvency after falling into default with its lender Citizens Bank NA, which halted automatic advances under its revolving line of credit. At the same time, the company came under fire in Mexico for allegedly "obstructing workers' freedom of association and right to collective bargaining," prompting an investigation by the U.S.-Mexico-Canada Agreement's Interagency Labor Committee for Monitoring and Enforcement.
In May, GM, Stellantis and Yanfeng agreed to bail out the insolvent supplier with price increases and investment of up to $15 million to tide over the company. It is unclear what role, if any, production stoppages due to the United Auto Workers strike played in preventing the company from regaining its footing.
Crain's inquired with GM and Stellantis about how the supplier's bankruptcy impacts their business. James Plemmons, attorney at Detroit-based Dickinson Wright PLLC representing Stellantis and Yanfeng in the case, declined to comment.
On a call with investors a year ago — the last time the company addressed Wall Street other than through SEC filings — CEO Doug Cain expressed optimism about getting its debt in order and winning new business. About 90 percent of revenue is tied to automotive, with the rest composed of home appliance and consumer off-road.
Like other automotive suppliers, Unique Fabricating was struggling with production volatility, shrinking volumes and inflation, according to executives. Cain said a year ago that Unique Fabricating had recently won a takeover project to supply electric vehicle maker Rivian with shaped foam HVAC ducts. That project was to launch last December, but it is unclear if it did.
Crain's inquired with Rivian about the status of that agreement and what the bankruptcy means for the company.
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