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Auto Supplier First Brands Files for Bankruptcy Amid Accounting Jitters
September 29, 2025
By The Wall Street Journal
Auto-parts supplier First Brands Group filed for bankruptcy Monday, threatening big losses for its lenders after the market lost confidence in its financial disclosures and its use of off-balance-sheet debt.
The privately held company is bringing on independent directors to examine the off-balance-sheet financing arrangements, which total in the billions, people familiar with the matter said.
First Brands enters chapter 11 in the U.S. Bankruptcy Court in Houston with an agreement from a group of senior lenders to provide a $1.1 billion loan to finance the proceedings, the company said in an announcement.
“With committed funding from our key financial partners, we remain focused on supporting our employees, working with our valued suppliers, and delivering best-in-class aftermarket automotive technology for our customers globally,” said Chuck Moore of Alvarez & Marsal, First Brands’ chief restructuring officer.
First Brands had been working an effort to refinance its $6 billion of corporate debt that fizzled last month after lenders demanded more details about the company’s earnings and factoring agreements, a type of supply-chain financing in which third-party investors assume payment streams and obligations.
Investors also became skittish as they learned that Apollo Global Management, the asset-management giant, had earlier bet against First Brands by purchasing credit-default swaps on the company’s debt. First Brands’ loans cratered in value in recent weeks, marking one of several troublesome developments for the strained automotive industry.
The First Brands is advised by Lazard and Weil Gotshal. A group of First Brands’ top lenders is represented by the law firm Gibson Dunn & Crutcher and Evercore. A smaller group of lenders has organized with Glenn Agre Bergman & Fuentes in an attempt to participate in the bankruptcy loan being negotiated with the larger lender group, according to people familiar.
Rochester, Mich.-based First Brands supplies auto parts like brake components, wiper blades, and spark plugs. The company grew rapidly in recent years through a series of brand acquisitions.
