Chrysler gains interim court order to force Canadian parts manufacturer Transcast Precision Inc. into short-term deal



    TORONTO, April 3 /CNW/ - Today, the Ontario Courts ordered Transcast
Precision Inc. (Transcast) to supply sufficient parts to Chrysler, GM, Magna
and Gates for 14 days of production. Additionally, another proceeding is
required within that two-week period to settle matters regarding ongoing price
and supply.
    "If the North American auto industry intends to rebuild itself and emerge
from our current recession, it must defend the rights of all business owners -
especially the auto parts manufacturers who are being economically exploited,"
said Dean Topolinski, President and Director of Transcast Precision Inc. "We
are hopeful that the courts will recognize the established pricing and
negotiations tactics that exist in market - ones predisposed to the unfair
treatment of smaller auto parts manufacturers and suppliers that rely on
relatively few, but very large customers."
    "Transcast has regrettably been portrayed by Chrysler et al as a form of
corporate raider seeking to take advantage of the OEMs in the current economic
maelstrom in which the automotive industry finds itself. Transcast has had no
opportunity to present its side of this story in the proceedings, which were
commenced without notice to Transcast and while senior management were out of
Canada."

    Background

    On Monday March 30th, Transcast initiated contact with Chrysler to sell
existing company assets and to enter into an agreement that would permit the
long-term viability of the new company. While the correspondence indicated
that inventory would need to be purchased above previous prices, the increase
was required to help offset a number of transition costs including legal bills
and unpaid severance from the previous supplier. This price increase was for a
5-day term only. The longer-term agreement was to be negotiated during this
interim phase.
    Notwithstanding, Transcast's offer to negotiate, Chrysler, Magna, Gates,
and GM decided not to engage in discussions to come to a commercial solution
to keep the plant open. Rather, they proceeded without notice to take
Transcast to Court to seek interim relief for the return of tooling and parts.
When Transcast discovered the ex parte motions, they appeared in court and
vigorously opposed the position presented by Chrysler, Magna, Gates and GM.
Transcast will continue to argue its position in court by presenting the facts
of the case which has yet to be finally argued. Any orders made by the Court
at this stage are interim only.





For further information:

For further information: Hugh Mansfield, office (416) 599-0024 ext. 237,
Cell (416) 918-4791; or Rob Ireland, office (416) 599-0024 ext. 241, Cell
(416) 301-9585

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TRANSCAST PRECISION INC

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