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Lear readies prepackaged bankruptcy

Posted Friday, Jun 26, 2009, 12:56 pm in Employee News

Automotive seating giant Lear Corp. is preparing a prepackaged bankruptcy five days before it must make a $38 million interest payment on two of its bonds, according to a Dow Jones report citing people familiar with the situation.

Lear spokesman Mel Stevens said the company does not comment on speculation and rumors, according to the report. If the prepackaged deal collapses, Lear could file for a traditional-style bankruptcy next week, the report said.

The suburban Detroit parts maker has been in violation of its loan covenants since late last year, the news service said. The company’s banks granted and recently extended a covenant waiver, but the waiver expires June 30, the story said. (Automotive News)
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