11th Hour Reprieve

Swiss based alloy wheel manufacturer Uniwheels has acquired the European interests of Germany’s ATS Group, former subsidiary of South African company Tiger Wheels. Included in the purchase are the company’s affiliated production factories in Germany and Poland as well as the globally recognised ATS brand name. We can only speculate at the purchase price – Uniwheels has chosen not to disclose this – and a separate solution is sought for the company’s US subsidiary, ATS Light Alloy Wheels (Alabama), Inc.

“With Uniwheels we have found an investor, who is taking over the shares of the subsidiaries of the insolvent ATS Beteiligungs GmbH,” commented Tobias Hoefer, representative of the Group’s insolvency administrator, Hack Hoefer. “With that in Europe all jobs and sites of the Group can be kept. This is the best possible result for the creditors and the employees.”

In its European operations ATS manufactures approximately five million alloy wheels per year, and Uniwheels some two million. The company will thus have a manufacturing volume of seven million units after the takeover, planned for implementation on or before April 1, and company turnover will increased to approximately 350 million euros. The specific European sites named in the acquisition are ATS Stahlschmidt & Maiworm GmbH in Werdohl, ATS aluStar Wheels Trading GmbH and ATS Leichtmetallräder GmbH & Co. KG in Bad Dürkheim, as well as the Polish subsidiaries ATS Stahlschmidt & Maiworm Sp. z o.o. and ATS aluStar Polska Sp. z o.o.

On July 13, 2007, ATS Beteiligungs GmbH and the ATS Stahlschmidt & Maiworm GmbH facility filed for insolvency due to inability to pay and debt overload. This move came two days after the trading of Tiger Wheels shares was suspended on the South African stock exchange. Shares in the parent company had dropped in value by more than 40 per cent since the end of May 2007, and on May 30 the company gave notice that the performance of its 74 per cent held German ATS business had failed to meet the expectations of the revised performance forecast made to its German financing syndicate the previous February. In spite of this, together with ATS management Hoefer was, over the course of a few weeks, able to stabilise the Group and bring the operational affiliate ATS Stahlschmidt & Maiworm GmbH out of insolvency. The process was supported by creditors, comments Hoefer, especially by the banks, car manufacturers and suppliers.

The acquisition makes Uniwheels Europe’s third largest wheel manufacturer and supplier of light metal rims. The company states that the know-how of Uniwheels in the aftermarket area and the OEM technical competence of ATS complement each other ideally. It sees the benefits for Uniwheels AG to primarily come in the form of the qualified and OEM market experienced employees it inherits from ATS as well as new customers, sales capacities and market access points. “The capabilities of ATS fit perfectly into the portfolio and strategic orientation [of the] Uniwheels group, said group marketing director said Harald Jacksties. “The acquisition symbolises an essential contribution to the growth opportunities and sustainability of both companies.”

Uniwheels plans to continue operating and expanding the current ATS locations in Germany and Poland, and emphasises it has no intention to downsize these operations. Cost efficiency is to be increased by investments in the respective locations, promoting the factories’ long-term sustainability.

While the acquisition has come as a reprieve for the European ATS operations, the former parent company in South Africa has experienced no such salvation. The ATS plant in Rosslyn, South Africa, has been liquidated at the loss of some 400 jobs, and Tiger Wheels, in its prime valued at around £380 million, is no longer a going concern.