French automotive supplier Akwel has submitted a bid to buy global auto supplier Novares Group, which filed for bankruptcy protection on April 29.
Nanterre Commercial Court, which placed Novares into receivership, is scheduled to review all buyout offers and announce its decision concerning either a continuation or disposal plan at the end of May, according to a May 13 release by Champfromier, France-based Akwel.
"The planned business combination between the two groups, which will require the support of the Novares Group's clients and banks, would capitalize on a strong level of proximity (scale, clients, technologies, global industrial footprint) and highly complementary positionings (product ranges, innovation portfolios)," Akwel said in its release. "This project would be aligned with its long-term goal to build an equipment manufacturer with an even stronger scale dedicated to serving global automotive manufacturers."
Indian auto parts supplier Samvardhana Motherson Group has also been mentioned in reports as a potential buyer of Novares, although it has not made any public statement.
Novares announced May 18 that it is reopening 13 of its 19 European production sites, located in France, Spain, Italy, Portugal, Serbia, Turkey and Romania, "with better than expected production rates."
Novares reported that it had received a liquidity injection or 45 million euros ($49 million) from its two largest shareholders: Equiston Partners Europe and BPI Group SA.
"The results for 2019 and for the beginning of 2020 have shown that the foundations of the Novares Group are solid," CEO Pierre Boulet said in the release. "But the COVID-19 crisis has taken a serious toll on our cash flow, which has been largely factored.
"The overriding aim of being able to ensure deliveries to our customers, as of May, has forced us to seek legal recourse. We are now resuming our operations in Europe, and are confident that a solution will be found in the coming days to enable the company to restart activities at its American plants, as well as to ensure the future of the Novares Group in the long term."
Novares has received seven investment proposals. Four of those proposals would "ensure the financial continuity required at the end of the receivership procedure, expected on May 27," the release said.
"The company and the procedural bodies are currently carefully examining these four options so as to ensure a successful outcome and to come to a decision before the end of the month."
Novares, based in Clamart, France, is a major global injection molder, with 12,000 employees and operations in 22 countries. Its North American holdings include the former Key Plastics LLC and Miniature Precision Components Inc. businesses.
In North America alone, the company ranks No. 19 in the most recent Plastics News ranking of injection molders, with an estimated $425 million in sales.