Metaldyne Announces Delay in Filing of Form 10-K with SEC due to Independent Inquiry

PLYMOUTH, Mich., March 29 -- Metaldyne Corporation (the "Company") today announced a delay in the filing of its annual report with the Securities and Exchange Commission. Pursuant to provisions of the Securities Exchange Act of 1934 (the "Exchange Act"), on March 29, 2004, the Company is obligated to file its Annual Report on Form 10-K containing its audited financial statements for its 2003 fiscal year ended December 28, 2003. The Company is unable to file its Form 10-K with financial statements at this time and its independent auditors, KPMG LLP, are unable to complete their audit of the Company's 2003 financial statements due to an independent inquiry into certain matters at the Company's Sintered division described below. As permitted by Rule 12b-25 promulgated pursuant to the Exchange Act, the Company intends to file a notification which will provide, among other things, that its Form 10-K filing will nonetheless be timely filed if it is filed no later than 15 calendar days after its original due date. The inquiry and the audit may not be completed within that extended time frame.

A plant controller at the Sintered division's St. Mary's, Pennsylvania facility notified the Company's outside auditors that he was unable to reconcile certain of the plant's general ledger accounts and to find appropriate documentation for certain entries and indicated that he had concerns regarding the division controller. As a result, the Company authorized Marshall Cohen, an independent director, with the assistance of an independent counsel, Sidley Austin Brown & Wood LLP, and Deloitte & Touche's forensic accounting group, to look into allegations concerning accounting procedures and financial accounting at that plant and the rest of the Sintered division's facilities. The Company's management is fully cooperating with the inquiry. The Sintered division is a part of the Company's Engine segment and, based on previously published financial information, represents approximately 10% of the Company's net sales.

Through the inquiry, the Company became aware of errors with respect to the recording of certain entries which it has been attempting to analyze. Recently, while the Company was performing these analyses, the Sintered division controller made the following allegations concerning actions in which he admittedly participated. He alleges that, following the November 2000 acquisition of the Company by Heartland Industrial Partners, L.P. and its co- investors, income at the Sintered division from 2000 through 2003 was deliberately understated by up to approximately $10 million in the aggregate. He alleges that these understatements were part of an effort to disguise previous overstatements of income by approximately $20 million in aggregate at the Sintered division during the period from 1996 through 1999, which was prior to the acquisition of the Company by Heartland and its co-investors. The independent director recommended and the Board has directed that the initial inquiry be expanded to review these allegations. If necessary, the inquiry will extend beyond the U.S. Sintered division to evaluate these or other matters, and the impact of any further expanded inquiry is difficult to predict.

During the course of the inquiry, the Company has identified various errors in accounting at the St. Mary's and Ridgway, Pennsylvania and the North Vernon, Indiana facilities. Based upon immediate attention by the Company's internal audit staff to the questions raised by the plant controller, the Company has concluded that the financial controls and procedures within its U.S. Sintered division require improvement to avoid unintentional errors and to ensure the accuracy of financial reporting. Some actions to improve controls were immediately undertaken and other actions are being implemented, including actions with respect to personnel, training and improved documentation. The Company has terminated the Sintered division's controller based upon his admitted participation in these matters. A new division controller has been hired and is expected to begin work immediately. Further actions will be taken, as appropriate, based upon the inquiry and the recommendations of the Company's advisors and auditors. In addition, to facilitate the inquiry, the corporate controller, who served as the controller of the Engine group until recently, has been placed on administrative leave.

The Company cannot presently comment upon the timing for completion of, or the ultimate scope or outcome of, the inquiry and the audit. Until the inquiry is complete, it will be difficult to determine the scope of any potential financial restatement or prior period adjustments arising from these errors and the allegations referred to above. The Company is obligated to provide audited financial statements under a number of its debt, operating lease and other agreements within prescribed periods. The Company has initiated discussions with its senior credit facility lenders and is in the process of seeking a waiver of the audit delivery requirements under its senior credit facilities and under its receivables facility for a period of time. There can be no assurance that this, or any other required waivers, will be received on a timely basis and the failure to obtain waivers could be material and adverse.

About Metaldyne

Metaldyne is a leading global designer and supplier of metal-based components, assemblies and modules for the automotive industry. Through its Chassis, Driveline and Engine groups, the Company supplies a wide range of products for powertrain and chassis applications for engines, transmission/transfer cases, wheel-ends and suspension systems, axles and driveline systems. Metaldyne is also a globally recognized leader in noise and vibration control products.

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from anticipated results because of certain risks and uncertainties, including but not limited to general economic conditions in the markets in which the Company operates, declines in North American automobile and light truck builds, reductions in outsourcing by the Company's automotive customers, the Company's dependence on automotive industry and industry cyclicality; customer concentration; increases in the Company's raw material and energy costs, labor costs and strikes at our major direct and indirect customers and at the Company's facilities, dependence on significant automotive customers, the level of competition in the automotive supply industry and pricing pressures from the Company's customers, technological developments that could competitively disadvantage the Company, risks associated with conducting business in foreign countries, the results of the pending inquiry, dependence on key personnel and relationships, and the Company's high leverage and ability to service its debt; and the impact of any defaults under its material agreements and debt instruments.