Collins & Aikman Moves To Avoid $31M Claim

Law360, New York (August 9, 2006, 12:00 AM EDT) -- Beleaguered auto parts manufacturer Collins & Aikman Corp. is seeking bankruptcy court approval to sell its stake in an unprofitable joint venture and evade a $31 million claim against it in the process.

If the motion is approved, Collins & Aikman will be allowed to sell its 69% ownership of a venture it entered into with Mobis Alabama LLC. Mobis would buy out the rights for $3.92 million in cash.

As part of the deal, penned by debtor’s counsel Kirkland & Ellis LLP, Mobis will fork...
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