MBK joins acquisition of $1.3 bn debts in Marelli from KKR

MBK Partners Ltd., alongside Deutsche Bank AG and other four investment firms, has acquired $1.3 billion worth of distressed debts in auto-parts supplier Marelli Holdings Co. from US private equity giant KKR & Co., investment banking sources said on Dec. 2.

MBK, one of the largest PE firms in Asia, has completed the transaction via its $1.8 billion special situation fund MBKP SSF II which it closed in November last year. 

The North Asia-focused PE firm joined the acquisition deal as it expected the value of the debt-laden Marelli bonds, with large discounts, will sharply increase once the auto parts supplier normalizes its business management.

KKR bought a 40.7% stake in auto parts supplier Calsonic Kansei Corp. from Nissan Motor Corp. in 2016. Through Calsonic Kansei, the US PE giant acquired Magneti Marelli from Fiat Chrysler Automobilles N.V. for €5.8 billion ($6.1 billion) and incorporated the two auto parts companies into Marelli in 2019.

Since 2020, Marelli has suffered from the global supply disruptions of auto chips as well as a steep decline in sales amid the pandemic.

Facing debt of more than 1.13 trillion yen ($8.4 billion), Marelli said in July that lenders representing above 90% of the firm’s bank debt approved its revitalization plan and the Tokyo District Court has confirmed it.

KKR will conduct Marelli’s capital restructuring, by investing in new equity capital and reducing bank debt to improve the automotive supplier’s financial stability, the auto parts maker stated at the time.

Write to Jun-Ho Cha at chacha@hankyung.com
Jihyun Kim edited this article.