LOS ANGELES, June 10, 2013 (GLOBE NEWSWIRE) -- Motorcar Parts of America, Inc. (Nasdaq:MPAA) today said it expects the company's separately capitalized subsidiaries, Fenwick Automotive Products Limited and Introcan ("Fenco"), will file for bankruptcy.
Fenco is currently being managed by a chief restructuring officer and a board not affiliated with Motorcar Parts of America, and Fenco will make any decision as to the timing and process for any bankruptcy proceeding.
"While Fenco had made progress in its transition plans for the undercar segment since the acquisition, the cost savings and operational efficiencies were not sufficient for Motorcar Parts to continue its involvement with Fenco under the current financial structure. Motorcar Parts of America has written off its investment in Fenco, which will be disclosed in the company's fiscal 2013 year-end results. The separation of the control of Fenco from us will result in the deconsolidation of Fenco from our financial statements," said Selwyn Joffe, chairman, president and chief executive officer of Motorcar Parts of America.He emphasized that Motorcar Parts of America's rotating electrical base business continues to be strong. "We expect to report record sales of approximately $213 million for rotating electrical when the company files its fiscal 2013 year-end results this month," Joffe said. He noted that the company's liquidity remains strong. Motorcar Parts of America expects to report a cash position of approximately $19.0 million, and approximately $18.0 million available under the company's revolving credit facility at March 31, 2013. He added that the company will realize tax benefits as a result of the losses incurred through Fenco. These benefits will be realized in stages, based on the availability of refunds from past taxable periods and reductions in tax payments on future earnings. About Motorcar Parts of America Motorcar Parts of America, Inc. is a remanufacturer of alternators and starters utilized in imported and domestic passenger vehicles, light trucks and heavy duty applications. Motorcar Parts of America's products are sold to automotive retail outlets and the professional repair market throughout the United States and Canada, with remanufacturing facilities located in California, Mexico and Malaysia, and administrative offices located in California, Tennessee, Mexico, Singapore and Malaysia. Additional information is available at www.motorcarparts.com . The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for certain forward-looking statements. The statements contained in this press release that are not historical facts are forward-looking statements based on the company's current expectations and beliefs concerning future developments and their potential effects on the company. These forward-looking statements involve significant risks and uncertainties (some of which are beyond the control of the company) and are subject to change based upon various factors. Reference is also made to the Risk Factors set forth in the company's Form 10-K Annual Report filed with the Securities and Exchange Commission (SEC) in September 2012 and in its Forms 10-Q filed with the SEC thereafter for additional risks and uncertainties facing the company. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as the result of new information, future events or otherwise.
CONTACT: Gary S. Maier Maier & Company, Inc. (310) 471-1288 For Motorcar Parts of America Inquiries Donald MacKenzie (212) 586-2200 For Fenwick Automotive Inquiries