Sept 20 (Reuters) – U.S. auto-parts maker Garrett Motion Inc said on Sunday it filed for Chapter 11 bankruptcy protection, as it struggled with heavy debt due to a payment settlement dispute with former parent Honeywell International Inc HON.N and the COVID-19 pandemic.
Garrett said it entered into a “stalking horse” purchase agreement with private equity firm KPS Capital Partners LP for $2.1 billion.
The “stalking horse” agreement would imply that any other bids that come in must be higher than the offer made by KPS. The agreement is subject to court approval.
Garrett said it was also seeking court’s approval for a $250 million debtor-in-possession financing facility. Throughout the reorganization process, Garrett expects to operate without interruption.
The company listed both assets and liabilities in the range of $1 billion and $10 billion, according to a filing with the U.S Bankruptcy Court for the Southern District of New