Expect to see more competing bids to buy C&A
I am hearing that a competing bid -- and one C&A insider said the company expected more of them, will be announced soon.
As to the $1 billion Plastech bid,they have been interested in buying parts of C&A for three to four years. A person familiar with the offer said that Plastech wants C&A for its business with Asian automakers as well as its contracts on products such as instrument panels, a line of work Plastech does not have.
If successful, the bid for Troy-based C&A could ensure a steady supply of parts to assembly plants across the country -- something that the Detroit automakers have been concerned about because if the C&A went under it could slow down or shut down auto plants across North America or even Europe.
Plastech has discussed its interest in buying C&A with Detroit's three automakers, which each do about $1 billion or more in business with the company and have C&A parts on important vehicles such as the Ford Mustang, Chevrolet Corvette and Chrysler 300.
Plastech came away "with the idea that the automakers are supportive of the move," said a source familiar with the offer.
Plastech hopes to buy C&A as quickly as possible, before the supplier loses any business or customers, said people familiar with the deal.
Corporations often like to buy other companies out of bankruptcy because the purchase comes free and clear of all sorts of financial obligations, like pensions, labor claims or product-liability suits.
Companies are also far cheaper to buy in bankruptcy -- which is why a company like Plastech, which is one-fourth the size of C&A, bid to purchase it.
If it acquired C&A, Plastech would become the fourth-largest privately held company in Michigan.
Bottom line is expect to see more competing bids come to light in the days ahead.
