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September 3, 2009

Autocam Completes Recapitalization; Positions the Companies for Growth


KENTWOOD — Yesterday, the Autocam group of companies completed a financial restructuring shedding a significant amount of debt thereby improving their financial position and allowing them to capitalize on emerging opportunities in the fields of automotive fuel-conservation technologies and implants, instruments and devices used in orthopedic, cardiovascular and ophthalmic surgical procedures. With the completion of this restructuring, Autocam continues to be owned by a group of shareholders led by its current president, Mr. John C. Kennedy, who is majority shareholder of the companies.

In the transaction, the companies decreased their combined indebtedness, net of cash holdings, from approximately $104 million to approximately $20 million. The shareholder group provided $10 million of this debt as the credit markets remain largely unavailable to companies operating within the transportation industry.

The completion of this transaction will position the organization to capitalize on the transportation market’s movement toward more fuel efficient and environmentally friendly vehicles. This demand is expected to steadily increase over the next 3-5 years as emissions standards become more stringent domestically and internationally. In addition, the organization will have the financial flexibility to invest in projects that will support the enormous growth trends currently seen for surgical implants, instruments and devices. Since 2004, annual sales of precision-machined components to medical devices customers have grown from $9 million to over $35 million expected in 2009.

In commenting on the transaction, Mr. Kennedy said, “This restructuring is a significant event in the history of our company. The downturn in the global automotive market and the general weakness in the U.S. economy have presented significant challenges for us, but the strength and dedication of our employees has allowed us to manage through this period and to complete this restructuring. The shareholder group has great confidence in the people of Autocam, and its members believe the company is ideally positioned to take advantage of new opportunities in green automotive technologies and breakthrough medical components and devices with this new investment.”

Autocam Corporation was advised by its financial advisor, Huron Consulting Services, LLC, and its legal counsel, Kirkland & Ellis LLP.

Autocam is a world leader in the design and manufacture of high volume, precision-machined, extremely close tolerance, specialty metal alloy components and assemblies sold to the transportation and medical device industries. Autocam serves automotive, medical and consumer products companies around the world from 11 facilities in North and South America, Europe and Asia. Founded in 1988, it employs more than 1,200 people. Among its core competencies are: precision turning, precision grinding, gear manufacturing, precision milling, forging, plastic molding, rotary transfer machining, precision secondary machining, sub-assembly, laser machining, finishing, heat treatment, precision cleaning, and precision measuring. More information can be found at autocam.com.