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Spanish auto parts maker Antolin wins U.S. asset protection
Yahoo Finance says firm serves automakers including Ford, GM, Stellantis, Volkswagen, Hyundai and Renault-Nissan
Antolin manufactures doors, instrument panels, center consoles, interior coverings and roof components as well as electronic systems. (Brent Lewin/Bloomberg)
Key Takeaways:
- A U.S. judge on July 22 granted Grupo Antolin temporary protection from creditor lawsuits while its Spanish restructuring awaits court approval.
- The auto parts supplier serves major automakers, employs about 20,000 people — including 2,100 in the U.S. — and cited debt, weak demand, tariffs and industry pressures.
- Bondholders holding 67.2% of senior secured notes plan to challenge the restructuring, arguing it favors banks and preserves family control.
Spanish auto parts maker Grupo Antolin-Irausa was granted court protection for its assets in the U.S. on July 22, the latest development in an ongoing legal case to recognize the restructuring procedure it started in Spain last month.
Judge Shireen Barday said she’ll grant Antolin’s request to protect the company’s U.S. assets by preventing creditors from bringing new lawsuits for several weeks. The litigation pause was needed because Spanish courts are on summer break and won’t consider approving the restructuring until September or October at the earliest, an Antolin representative said in court papers.
Yahoo Finance reported that Antolin serves major automakers including Ford, General Motors, Stellantis, Volkswagen, Hyundai and Renault-Nissan.
According to the company’s petition, 75-year-old Antolin manufactures doors, instrument panels, center consoles, interior coverings and roof components, as well as electronic systems such as lighting, smart surfaces, human-machine interfaces and sun visors.
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The company operates 111 production plants and just-in-time delivery centers in 23 countries and employs about 20,000 people. Its U.S. operations include 10 production plants, a technical-commercial office and roughly 2,100 employees.
Court filings cited by Yahoo Finance said Antolin supplies more than 110 automotive brands and about 20 original equipment manufacturers. Its components are used in more than 500 vehicle models worldwide, including nine of the 10 top-selling vehicles globally.
The company, which has the backing of a majority of its lenders for the Spanish restructuring, filed July 20 for Chapter 15 bankruptcy in the Southern District of New York, court records show. Chapter 15 provides protection from creditors in the U.S. while a debtor works on a foreign restructuring.
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The U.S. filing included court documents from the Spanish restructuring, in which the Burgos, Spain-based company said that the founding Antolin family should continue to control and manage the business.
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Carmakers have confidence in Antolin in large part because of the stability that family management has historically provided and because the family’s experience and relationships are valuable intangible assets, according to the filing.
“The Antolin family is an essential asset of the group and constitutes the unifying element of its identity, strategy and position in the global market,” according to the documents.
Restructuring challenge
The U.S. filing comes after bondholders brought legal action challenging the restructuring in a United Kingdom court. Bondholders said in a New York court filing that the Spanish restructuring proposal unfairly favors bank lenders and forces noteholders to take a loss despite holding the same collateral and equal liens.
Bondholders didn’t oppose the initial litigation pause but do intend to challenge the Spanish restructuring, said Erin Dexter, a lawyer at Milbank representing a noteholder group.
At the July 22 hearing, Dexter said the plan violates U.S. Chapter 11 rules because the Antolin family will retain ownership of the company. She added that it is a “lose, lose” situation for bondholders because they’re being forced to choose between taking a roughly 32% loss or an extension on maturities that would deliver less yield.
Funds associated with Benefit Street Partners and Spire Partners — members of the ad hoc group of the Spanish firm’s noteholders — filed a claim against Antolin in the U.K. on July 10, U.S. court documents show. The group collectively holds 67.2% of Antolin’s senior secured notes, it said.
They allege that the proposed restructuring plan is unfair given that it leaves the Antolin family, the shareholder of the group, “completely untouched,” lawyers for the group said in the filing. The deal also envisages giving bank lenders preferential treatment — a breach of the intercreditor agreement drafted under English law, noteholders said in the claim.
Representatives for Benefit Street Partners, Spire and Grupo Antolin declined to comment.
Antolin would have been unable to meet its debt maturities over the next couple of years, according to the documents. CEO Cristina Blanco cited “industrywide headwinds” that include weaker demand, tariffs, the wars in Ukraine and Iran, commodity price increases and a slower-than-expected transition to electric vehicles. The company also struggled with “a high level of indebtedness” resulting from its 2015 purchase of Magna International's car-interiors business for about $525 million.
