Stellantis supplier CLN seeks 90% writedown on its bank debt

(Bloomberg) — Italian auto parts maker CLN-Coils Lamiere Nastri SpA asked bank creditors to write down about 90% of its unsecured loans as it seeks to significantly reduce debt amid the auto industry crisis.

Earlier this month, Stellantis NV’s Turin-based supplier sent a restructuring proposal to creditors holding more than 300 million euros ($312 million) in loans, according to people familiar with the matter. Under the plan, lenders would receive equity-like financial instruments and the company would sell some of its assets, people familiar with the matter said. Asked to remain anonymous while discussing private information.

CLN CEO Gabriele Perris Magnetto declined to comment.

The plan is an early proposal that could still change as negotiations continue, but it highlights the difficulties auto suppliers face as orders from automakers dry up. Vehicle shipments from Stellantis, one of CLN’s largest customers, have fallen sharply in recent months, falling 20% ​​in the third quarter and 9% in the fourth quarter.

The supplier was founded after World War II by Mario Magnetto, whose family still owns 75% of the shares, while steelmaker ArcelorMittal SA owns the remainder. CLN, based near the historic Turin headquarters of Fiat (now part of the Stellantis brand), has expanded in recent years across Europe, Latin America, China and South Africa.

The company has been under court protection from creditors since October, according to a company filing. The €50 million bond is due to mature in November.

—With the assistance of Alberto Brambilla.

(Updated with CEO comments in third paragraph and more details in final paragraph.)

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