Auto parts maker Marelli secures $1.2 billion financing to withstand crisis

MILAN (Reuters) – Auto parts maker Marelli said on Wednesday it had secured additional capital and loans worth 130 billion yen ($1.2 billion) from top shareholder U.S. investment firm KKR and Japanese banks.

The COVID-19 epidemic has forced most manufacturers to temporarily halt production and almost erased car demand in March and April, leaving car and auto parts makers in need of cash.

“Access to this additional capital gives us the flexibility to withstand an extended market downturn and protects the long-term financial health of the business,” Chief Financial Officer Christoph Hobo said in a statement.

Clients of Marelli, which combines former Fiat Chrysler unit Magneti Marelli and Japan’s Calsonic Kansei, include Volkswagen , PSA and Fiat Chrysler.

(Reporting by Giulio Piovaccari, editing by Gianluca Semeraro and Jason Neely)