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March 26, 2014 02:00 AM

Cooper Standard embarks on global expansion

Chris Sweeney
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    Cooper Standard, fresh off a very good 2013, plans expansions in every region of the world. This Cooper Standard facility is located in Mexico.

    NOVI, Mich.—Cooper Standard Automotive Inc. is opening 2014 with growing expectations, on the heels of a successful 2013 that saw its sales increase by $200 million to $3.1 billion.

    The firm is expanding in all regions of the globe, building a manufacturing plant in Sremska Mitrovica, Serbia; establishing two others in Bawal and Sanand, India; expanding its facility in Aguascalientes, Mexico; and preparing to open technical centers in Shanghai, China, and Manesar, India.

    In addition, its parent company is investigating a refinancing of its debt to try to reduce interest costs.

    Cooper Standard did not release financial details of its expansion projects.

    “We have a pretty significant commitment right now in expanding our footprint,” said Chief Operating Officer Keith Stephenson. “We're doing it in what we think is a responsible and logical way, and we're doing it in each part of the globe.”

    Its Serbia facility is nearly complete. The firm said the 193,750-sq.-ft. building is finished, and Cooper Standard is in the process of populating it with equipment for trial runs. Stephenson said the plant should be operational by mid-2014.

    The firm said 155 employees are training at its Italy and Poland facilities. Sremska Mitrovica eventually will employ 500. The plant primarily will focus on Cooper Standard's automotive sealing systems and components products, but Stephenson said it later could expand to include its fluid transfer and fuel and brake businesses.

    Once fully operational, the firm pro-jects net annualized labor savings of about $25 million.

    The firm just completed its expansion in Aguascalientes, which added 90,000 square feet, increasing the total size to around 310,000 square feet. It expanded capacity at the firm's main sealing facility in the North American region. It also added extrusion and finishing capacity.

    This is the inside of a Cooper Standard plant in Mexico.

    India gets 2 manufacturing plants

    Cooper Standard is establishing two manufacturing plants and a technical center in India.

    The firm said its facility in Bawal will be operational in the second quarter of 2014, and it initially will produce rubber sealing and trim parts.

    Its facility in Sanand will open in the first quarter of 2015. It will manufacture sealing and trim, and fuel and brake delivery products.

    The company plans to upgrade its existing manufacturing facility in Manesar, India, to include a technical center for research and development. The firm said it will have the capability for prototype development and simulation to drive its product development efforts.

    Stephenson said the firm's main focus in China is to finish its technical center, which the company hopes to start operating in April. The executive said the goal is to build up capability to support customers in the Chinese market and over time cover Cooper Standard's three core product lines.

    This is the front of Cooper Standard's plant in Serbia.

    Firm to launch refinancing

    Cooper Standard's parent company—Cooper Standard Holdings Inc.—said it intends to launch a refinancing of existing outstanding debt under its senior PIK toggle notes (HoldCo notes) due 2018 and Cooper Standard's 8.5 percent senior notes (OpCo notes) due 2018.

    Cooper Standard intends to enter into a $725 million senior secured term loan facility and use borrowings to refinance $200 million in aggregate principal amount of HoldCo notes and $450 million in aggregate principal amount of OpCo notes.

    Cooper Standard Holdings said the proposed refinancing is expected to reduce its annual interest expense. The refinancing is subject to market and other customary conditions. The firm said there is no assurance that the refinancing will occur.

    Cooper Standard is a leading global supplier of systems and components for the automotive industry. Its products include sealing and trim, fuel and brake delivery, fluid transfer, thermal and emissions, and anti-vibration systems. It employs more than 25,000 worldwide and operates in 19 countries.

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