KPS Special Situations Fund II Completes Acquisition of Jernberg Industries Inc., Iron Mountain Industries LLC and Related Entities Out of Chapter 11 Bankruptcy

Announces Formation of Hephaestus Holdings, Inc.

NEW YORK, Sept. 8 -- KPS Special Situations Fund II ("KPS") announced today that it has completed the acquisition of substantially all of the assets of Jernberg Industries, Inc., Iron Mountain Industries, LLC and related entities (collectively, "Jernberg"). KPS acquired the assets through a newly formed company, Hephaestus Holdings, Inc. ("HHI"). The transaction was accomplished pursuant to a 363 sale of assets under Chapter 11 of the bankruptcy code.

HHI is now one of North America's leading manufacturers of highly engineered forged parts for various power-train and wheel-end applications in the automotive industry. Products manufactured by HHI include wheel hubs, transmission turbine hubs, and axle ring and pinion gears. With over 800 employees, HHI operates four manufacturing facilities located in Chicago, Illinois.

KPS has retained Mr. George Thanopoulos, an executive with over twenty years of automotive experience, to lead HHI as its new Chief Executive Officer.

KPS invested $23 million of equity capital into HHI to fund the Company's turnaround plan and working capital. In addition, KPS provided HHI with $8 million of Interim Financing to fund the purchase of certain new manufacturing equipment. To complete the transaction in a very limited time period, KPS successfully negotiated over thirty unique agreements with the Company's customers, vendors, lenders and lessors; including three collective bargaining agreements with the United Steelworkers of America and a new $37 million senior lending facility with LaSalle Bank, N.A.

George Thanopoulos, Chief Executive Officer of HHI, said, "Our objective is to build the premier supplier of automotive forgings in North America. We thank the Company's customers, vendors and employees for their support through a difficult period. Our new Company looks forward to providing our customers with world class products and superior customer service. KPS has provided HHI with the resources for success and long term growth. I am very confident that by leveraging the skill, creativity and talent of our workforce, HHI will achieve its full potential."

Michael Psaros, a Managing Principal of KPS said, "We look forward to working with George Thanopoulos and the employees of HHI to create one of the world's leading automotive forging companies. We intend to aggressively build HHI through both organic growth and acquisitions. Acquiring and turning around Jernberg's business is an important first step in this process. The long term commitments made by the Company's valued customers made all of this possible. We thank the United Steelworkers of America for its support in connection with this complex transaction and LaSalle Bank and Conway MacKenzie & Dunleavy for their contribution to the process."

About KPS Special Situations Funds

KPS Special Situations Funds are a family of private equity funds with over $600 million of committed capital focused on constructive investing in restructurings, turnarounds and other special situations. KPS has created new companies to purchase operating assets out of bankruptcy; established stand- alone entities to operate divested assets; and recapitalized highly leveraged public and private companies. The KPS investment strategy targets companies with strong franchises that are experiencing operating and financial problems. KPS invests its capital concurrently with a turnaround plan predicated on cost reduction, capital investment, and capital availability. Typically, the KPS turnaround plan is accompanied by a financial restructuring of the company's liabilities. The KPS investment strategy and portfolio companies are described in detail at the firm's website: www.kpsfund.com.