First Brands filed for Chapter 11 late Sunday night, staggering under the weight of more than $10 billion in debt. The Rochester Hills, Michigan-based auto parts maker, known for producing brakes, windshield wipers, spark plugs, and fuel pumps, announced it had secured a lifeline—$1.1 billion in financing from creditors—to keep its engines running during the bankruptcy process.
The company compared the move to pulling an emergency brake on a runaway vehicle, aiming to stabilize its operations and steer toward a “value-maximizing transaction.”
Secured Financing Fuels Survival Bid
In its Monday statement, First Brands revealed that the $1.1 billion debtor-in-possession financing came from an ad hoc group of noteholders. This cash infusion will allow the company to continue operations, pay employees, and fulfill customer orders while navigating the complex restructuring.
Chief Restructuring Officer Chuck Moore reassured stakeholders, saying, “With committed funding from our key financial partners, we remain focused on supporting our employees, working with our valued suppliers, and delivering best-in-class aftermarket automotive technology for our customers globally.”
Advisors and Legal Counsel Step In
To steer through the legal and financial storm, First Brands has retained Lazard as investment banker and Alvarez & Marsal as financial adviser. Weil Gotshal & Manges LLP is representing the company, with attorneys Clifford W. Carlson and Matthew S. Barr leading the legal strategy.
