American Suzuki Motor Files for Bankruptcy Protection
American Suzuki had assets of $233 million and debt of $346 million as of Sept. 30, according to Chapter 11 documents filed yesterday in U.S. Bankruptcy Court in Santa Ana, California. Revenue for fiscal year ending March 31, 2012, was about $1.04 billion, according to court papers.
“After the global subprime recession began in 2008, the debtor’s continental U.S. automotive sales declined along with the rest of the U.S. automotive industry,” M. Freddie Reiss, American Suzuki’s proposed chief restructuring officer, said in court filings.
American Suzuki said it will redirect all of its operating resources to its motorcycle, all-terrain vehicle and marine products businesses. Reiss is a senior managing director in FTI Consulting Inc. (FCN)’s corporate finance and restructuring practice based in Los Angeles, according to court filings.
The Brea, California-based company said it plans to sell substantially all its assets to NounCo. Inc., a unit of Suzuki Motor Corp. The purchased assets will not include American Suzuki’s auto sales business. As part of the automotive division restructuring, American Suzuki will discontinue new automotive sales after its existing automotive inventory is sold. The sale is subject to higher and better bids at a court-supervised auction.
ATV, Marine Products
“The realignment is intended to better position ASMC for long-term success and is a return to the company’s roots in the U.S. market, which began with motorcycles and has grown to include ATV and marine products,” the company said in a statement.
American Suzuki Financial Services, owed $891,000, is listed as the largest creditor without collateral backing its claim, court papers show.
The case is In re American Suzuki Motor Corp., 12-22808, U.S. Bankruptcy Court, Central District of California (Santa Ana).
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