Metalforming customer objects to Lexington, Ky., plant sale

By Caroline Salls

Pittsburgh, Sept. 22 - Metalforming Technologies, Inc. customer and tooling owner Johnson Controls, Inc. objected to the company's proposed sale of its Lexington, Ky., plant, according to a Wednesday filing with the U.S. Bankruptcy Court for the District of Delaware.

According to the objection, Metalforming makes component parts under a "just in time" delivery method, so neither Metalforming nor Johnson maintains an inventory of the parts.

In turn, Johnson delivers the products which use the component parts on a just-in-time delivery basis, and interruption of that delivery will immediately result in millions of dollars of damages against Metalforming's estates.

"If this court confirms the sale of the Lexington assets to a bidder that either does not agree to continue production of the component parts or is not qualified to do so, each manufacturing or assembly line that relies on product from [Metalforming under] the purchase orders will be shut down for months," according to the objection.

Johnson said it estimates that it will take months to locate an alternate supply source, move the tooling, install the tooling with the alternate supplier and properly test and qualify the manufacture of the component parts with a different supplier as required under its contracts with its suppliers.

During this period, Johnson said all manufacturing of component parts must be interrupted.

A sale hearing is scheduled for Friday.

Metalforming, a Chicago-based automobile parts manufacturer, filed for bankruptcy on June 16. Its Chapter 11 case number is 05-11697.

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