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FOR
IMMEDIATE RELEASE
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Business Inquiries:
KPS 212.338.5100
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Media
Relations:
Mark Semer/Andrea Calise 212.521.4800
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KPS CAPITAL PARTNERS PORTFOLIO COMPANY, HHI GROUP
HOLDINGS, COMPLETES SUCCESSFUL RECAPITALIZATION
New
York, NY
(March 31, 2010) -- KPS Capital Partners, LP ("KPS") announced
today that its portfolio company HHI Group Holdings, LLC (“HHI”) has
completed a successful recapitalization. HHI raised $300 million of new
financing, including a $100 million committed but undrawn asset- based
revolving credit facility and a $200 million term loan. The proceeds of
the recapitalization were used to refinance outstanding debt, to fund a $150
million cash distribution to stockholders and to fund the Company’s
continued growth.
Following the recapitalization,
HHI remains conservatively capitalized with the continued support of KPS,
its majority shareholder, a private equity firm with over $2.6 billion of
committed capital. KPS and
minority shareholders including MC Capital Inc., a subsidiary of
Mitsubishi Corp., and HHI management continue to own 100% of HHI’s common
stock.
Financing for the transaction
was provided by a syndicate of banks and institutional investors with
Bank of America Merrill Lynch acting as sole lead arranger on the $100
million asset based revolving credit facility, and Bank of America
Merrill Lynch and Credit Suisse acting as Joint Lead Arrangers on the
$200 million term loan.
Jenner & Block LLP and
Proskauer Rose LLP served as legal counsel to HHI with respect to the
recapitalization.
About
HHI Group Holdings, LLC
HHI Group Holdings is the
largest independent manufacturer of highly engineered symmetrical and
asymmetrical forged parts for various power train and wheel-end
applications, a leading manufacturer of Generation III wheel bearings,
and one of the few manufacturers of engine timing systems for the North
American automotive industry. The
company operates through its Jernberg Holdings, Inc., Impact Forge Group,
Inc., HHI FormTech, LLC, Kyklos Bearing International, Inc. and Cloyes Gear and Products, LLC
subsidiaries. With over 2,600
employees, HHI is headquartered in Royal Oak, Michigan and operates 14
manufacturing facilities located in Arkansas, Illinois, Indiana, Michigan
and Ohio. For more information,
please visit www.hhigroupholdings.com.
About KPS
Capital Partners, LP
KPS Capital Partners, LP is the
manager of the KPS Special Situations Funds, a family of private equity
funds with over $2.6 billion of committed capital focused on constructive
investing in restructurings, turnarounds and other special situations.
KPS has created new companies to purchase operating assets out of
bankruptcy; established stand-alone entities to operate divested assets;
and recapitalized highly leveraged public and private companies. The KPS
investment strategy targets companies with strong franchises that are
experiencing operating and financial problems. KPS invests its capital
concurrently with a turnaround plan predicated on cost reduction, capital
investment and capital availability. Typically, the KPS turnaround plan
is accompanied by a financial restructuring of the company's liabilities.
The KPS investment strategy and portfolio companies are described in
detail at the firm's website: www.kpsfund.com.
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