American Axle reportedly close to rescue deal with General Motors

[DainBramaged]

(These are the scumbags that squeezed the UAW and THEN moved their production to Mexico.........)


American Axle & Manufacturing Holdings Inc. could be poised to close a rescue deal with General Motors Co. where the automaker would give the supplier $210 million and GM would have the ability to acquire a nearly 20 percent stake in American Axle.

The company was granted a two-day extension, until Sept. 17, of credit term waivers from its lenders yesterday as it continues to negotiate amendments to its credit lines, according to a company SEC filing today.

In order to close the rescue deal with GM, American Axle has to revamp about $1.3 billion in debt, which it has been working with its lenders since July to accomplish.

But the company could still end up in bankruptcy if its debt reduction efforts fail and another extension is not granted by Thursday, since the GM deal depends on American Axle completing the restructuring.

The current waiver of certain credit terms has allowed the company to try and negotiate an out-of-bankruptcy debt fix.

After being extended numerous times, American Axle won yesterday’s extension — its shortest extension yet, as most extensions have had durations of roughly two weeks — to allow negotiations continue.

In essence, the GM deal could provide the supplier with 10-day payment terms, a $110 million cash payment from GM, a new $100 million term loan and issue warrants for GM to buy nearly 20 percent of American Axle shares over time.

http://www.crainsdetroit.com/article/20090916/FREE/909169994


http://www.zimbio.com/CEO+Richard+Dauch

[DainBramaged]

1. Strike Settled, American Axle Details Layoff Plans

Fewer than half of the hourly employees at American Axle and Manufacturing who are returning to work this week for the first time since going on strike in February will still have jobs in a year, company executives said Wednesday.

The parts supplier said Wednesday that it expected to save about $300 million a year under its new contract with the United Automobile Workers union, largely by eliminating about 2,000 of the 3,650 jobs now held by U.A.W. members in Michigan and New York, along with an unspecified number of salaried positions.

Workers can leave voluntarily by accepting a buyout package worth either $85,000 or $140,000, depending on how long they have been there. Those who stay will earn considerably lower wages, which will be tempered by three annual “buydown” payments totaling as much as $105,000.

American Axle said its hourly labor rate, including wages and benefits, would be cut at least in half by the new contract, which had the support of 78 percent of the U.A.W. members who voted last week. Workers will earn an all-in rate of $30 to $45 an hour, or $26.54 for new hires, down from $73.48 under the previous contract. (During negotiations, the U.A.W. disputed the company’s calculation of the old numbers as too high.)

http://www.nytimes.com/2008/05/29/business/29axle.html