INTERMET CORPORATION EXHIBIT 99.2
5445 Corporate Drive
Troy, MI 48098-2683
Tel: 248-952-2500
Fax: 248-952-2501
[INTERMET LOGO]
NEWS RELEASE
For IMMEDIATE Release
Contact: Mike Kelly
INTERMET Corporation
248-952-2500
INTERMET FILES PLAN OF REORGANIZATION
IMPORTANT STEP TOWARD EMERGENCE FROM CHAPTER 11
COMPANY ALSO REPORTS NEW BUSINESS GAINS
TROY, Mich., June 24, 2005 -- INTERMET Corporation (INMTQ:PK), a diversified
manufacturer of cast-metal components, today announced that it has entered into
a commitment letter with R2 Investments, LDC and Stanfield Capital Partners,
LLC to underwrite an equity investment into INTERMET in the amount of $75
million, subject to certain terms and conditions and that it has filed a
proposed Plan of Reorganization with the United States Bankruptcy Court in the
Eastern District of Michigan. The commitment letter and court filing represent
important steps for the company in its efforts to strengthen its balance sheet,
complete its restructuring and emerge from Chapter 11. On September 29, 2004,
INTERMET and 17 of its domestic subsidiaries filed petitions for relief under
Chapter 11 of the United States Bankruptcy Code.
Commenting on today's announcement, INTERMET Chairman and CEO Gary Ruff said,
"The commitment letter and the filing of our reorganization plan are major steps
for us and represent the start of the final phase of INTERMET's operational and
financial restructuring. Over the last eight months, we believe much has been
accomplished in terms of putting the company back on track in its strategy for
long-term growth. We are especially pleased that we also have continued to
receive new and replacement business awards in our ferrous, light-metals and
European groups during this challenging time."
The proposed Plan of Reorganization provides for full payment of administrative
claims, tax claims, claims pursuant to INTERMET's debtor-in-possession credit
agreement, U.S. Trustee fees, consignment claims and claims of certain secured
pre-petition creditors. Payment for these claims will be funded by an exit
credit facility that INTERMET is currently negotiating and a new $75 million
equity investment pursuant to the Plan of Reorganization. Under the Plan of
Reorganization, unsecured creditors may either elect to receive shares of stock
in the reorganized INTERMET in exchange for their claims or they may elect to
receive cash. Reorganized INTERMET will provide 2.5 million shares of common
stock to unsecured creditors in exchange for their claims. Unsecured creditors
who elect to receive shares of stock in the reorganized INTERMET will also
receive the opportunity to purchase up to 7.5 million additional shares of stock
through the private rights offering at a price of $10 per share. To the extent
that the full $75 million is not subscribed for pursuant to the private rights
offering, R2 and Stanfield have agreed pursuant to the commitment letter to
purchase the shares of stock not otherwise purchased in the private rights
offering. Under the proposed Plan of Reorganization, all pre-petition equity
interests of INTERMET Corporation will be canceled.
Confirmation of the proposed Plan of Reorganization remains subject to various
requirements and the approval of the Bankruptcy Court.
About INTERMET: With headquarters in Troy, Michigan, INTERMET Corporation is a
manufacturer of cast-metal components for the automotive, commercial-vehicle and
industrial industries. The company has approximately 5,300 employees worldwide.
More information is available on the Internet at http://www.intermet.com.
Specific information relating to the Chapter 11 cases filed by INTERMET and
certain of its domestic subsidiaries, including a copy of the proposed Plan of
Reorganization, can be found on the Internet at
http://www.administar.net/intermet.
Cautionary Statement: This news release includes forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995. The
word "believe" and similar words and expressions identify forward-looking
statements. These statements are
not guarantees of future performance but instead involve various risks and
uncertainties. INTERMET's actual results may differ materially from those
suggested by its forward-looking statements due to factors such as: the economic
cost, management distraction and lost business opportunities associated with
bankruptcy proceedings; INTERMET's continued access to its DIP financing; the
high cost of scrap steel and the possibility that scrap steel costs will remain
at high levels or continue to increase, which would have further negative
effects on INTERMET's profitability, cash flow, liquidity and ability to borrow;
fluctuations in the cost of other raw materials, including the cost of energy,
aluminum, zinc, magnesium and alloys, and INTERMET's ability, if any, to pass
those costs on to its customers; pricing practices of INTERMET's customers,
including changes in their payment terms resulting from the discontinuation of
early payment programs and continuing demands for price concessions as a
condition to retaining current business or obtaining new business, and the
negative effect that price concessions have on profit margins; changes in
procurement practices and policies of INTERMET's customers for automotive
components, including the risk of the loss of major customers or the loss of
current or prospective vehicle programs as a result of INTERMET's financial
condition and prospects (or otherwise); possible inability to close unprofitable
plants or to transfer work from one plant to another because of the related
costs or customer requirements; general economic conditions, including any
downturn in the markets in which INTERMET operates; fluctuations in automobile
and light and heavy truck production, which directly affect demand for
INTERMET's products; deterioration in the market share of any of INTERMET's
major customers; fluctuations in foreign currency exchange rates; work stoppages
or other labor disputes that could disrupt production at INTERMET's facilities
or those of its customers; continuing changes in environmental regulations to
which INTERMET is subject, and the costs INTERMET will incur in meeting more
stringent regulations; factors or presently unknown circumstances that may
result in impairment of INTERMET's assets, including further write-downs of its
goodwill; and other risks as detailed from time to time in INTERMET's periodic
SEC reports.
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