Autoparts maker First Brands Group has agreed to sell a group of brands to Premium Guard (PGI) for $25m, after failing to secure rescue financing and losing important customers.
Under the deal, PGI will acquire key intellectual property and related assets from First Brands Group.
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The transaction remains subject to bankruptcy court approval and other closing conditions, and is expected to complete in early April.
According to a court filing cited by Bloomberg, PGI will take on certain liabilities linked to 12 brands included in the transaction, including Fram, Autolite and Trico.
First Brands had been seeking buyers for these units while continuing operations.
However, potential bidders withdrew as order volumes declined and liquidity pressures led the company to close additional factories.
PGI said the acquisition will broaden its product range and development capabilities, while maintaining its focus on private label programmes.
The company added that the deal will support its expansion into additional maintenance categories, including ignition and spark plugs, alongside its existing presence in filtration and wiper blades.
The inclusion of established international brands is also expected to aid PGI’s expansion beyond North America and enhance its ability to serve customers across multiple markets through its supply chain and distribution network.
PGI said the transaction does not change its core business model or its commitment to private label customers, adding that it will continue to prioritise category management and supply chain operations.
PGI founder and CEO Anan Bishara said: “This is a meaningful step forward for PGI. The know-how, patents, and engineering capabilities we are acquiring, particularly in wiper blades, spark plugs, and diesel filtration, significantly strengthen our platform, enabling us to continue developing advanced, reliable, and complete solutions across multiple tiers.”
First Brands, after shutting 17 plants and cutting 4,000 jobs earlier this year, has been trying to offload its remaining parts-manufacturing sites as new leadership unearthed pervasive wrongdoing and the company’s lenders balked at funding a costly turnaround of the conglomerate.
What’s left of the business has been kept running largely through advance payments from customers including Ford and Honda.
The latest sale is the second significant divestiture since First Brands began dismantling much of the company.
Earlier this month, it struck a $50m agreement to sell its fuel-management systems operation that supplies automakers.
Any proceeds from these disposals would be distributed to creditors, many of whom argue they suffered losses tied to the fraud that led to First Brands’ collapse last year.
