Johnson Controls Files Motion Against Plastech in Bankruptcy Court
Posted on: Monday, 3 March 2008, 09:00 CST
Johnson Controls, a provider of automotive interiors, has filed a motion in US Bankruptcy Court in Detroit seeking for Plastech Engineered Products to either accept or reject its sourcing agreement, reported Crain' Detroit Business. Plastech has filed for Chapter 11 bankruptcy.
Johnson Controls (JCI) has reportedly told the judge that Plastech is not able to produce parts at the pricing level of its current agreement. JCI also said that it has extended financial support to Plastech several times bowing to the latter's threats of stopping production of parts.
Crain's Detroit Business cited JCI as saying that it was concerned about the plastic supplier's request for further financial accommodations and support. According to the website, JCI has told the court that it cannot wait for Plastech to file its reorganization plan, which can take seven months to two years.
Crain's Detroit Business has quoted the motion filed by JCI as saying: "If the debtor cannot assume the (agreement) and perform according to its terms, the debtor cannot reorganize."
A JCI spokeswoman has reportedly declined to comment on the motion. Plastech has 15 days to respond to JCI's request.
Source: Datamonitor
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