FRANKFURT (Reuters) - German engine block and cylinder head maker Weber Automotive has filed for insolvency, following a spat between its family owners and French private equity group Ardian about the right restructuring strategy.
Finances have deteriorated despite solid orders, Weber Automotive said in a statement on Monday as it announced the filing, adding that the owners lacked unity about future financing of the maker of drivetrain components.
Ardian said that it was open to constructive discussions regarding an appropriate liquidity injection into the car parts maker, in which it bought a majority stake in 2016.
“While there is agreement between Ardian and the banks on what needs to be done, the Weber family has so far been reluctant to take the necessary action,” it said.
Ardian added that it has provided a high double-digit million euro amount of equity since its investment in 2016, while existing shareholders withdrew more capital from the company than they injected.
After a slide in Weber Automotive’s 2018 earnings, the company breached its debt covenants. An auditor proposed slashing rents for Weber’s sites, which is owned by the family who opposed the move.
A spokesman for Weber Automotive said the family would have no additional comment on their spat with Ardian.
Reporting by Arno Schuetze in Frankfurt and Alexander Huebner in Munich; Editing by Michelle Martin