Hephaestus Holdings, Inc. Announces Sale of Minority Equity Interest to Mitsubishi Corporation

CHICAGO, Oct. 3, 2006 -- Hephaestus Holdings, Inc. ("HHI") announced today that it has sold a minority equity interest to Mitsubishi Corporation ("Mitsubishi"). Financial terms of the transaction were not disclosed.

HHI, through its Jernberg Holdings, Inc. ("Jernberg") and Impact Forge Holdings, Inc. ("Impact Forge") subsidiaries, is the largest independent manufacturer of forged parts for the North American automotive industry. Jernberg (www.jernberg.com), through its subsidiaries, manufacturers highly engineered symmetrical forged parts for various power-train and wheel-end applications. Impact Forge (www.impactforge.com) manufactures highly engineered symmetrical and asymmetrical forged parts for transmission, power-train and wheel-end applications. HHI employs more than 1,200 people and operates eight manufacturing facilities located in the Chicago, Illinois, Indianapolis, Indiana and Coldwater, Michigan vicinities.

George Thanopoulos, Chief Executive Officer of HHI, said, "HHI is pleased to welcome Mitsubishi as a strategic investor. While we are committed to our existing domestic customer base and value the longstanding relationships we have enjoyed with our core customers, HHI continues to seek opportunities to diversify its customer base. We expect this relationship with Mitsubishi to contribute to the acceleration of our rapidly expanding business with the New Domestic automotive manufacturers in North America, and to the sourcing of our primary raw materials on a global basis."

Tak Ishikawa, CEO and President of MC Financial Services, a subsidiary of Mitsubishi Corporation, said, "HHI is positioned to take clear leadership of the forging sector of the automotive supplier base, and we are excited about the company's future. We are confident that Mitsubishi will add real value to the company on a number of fronts and look forward to working with HHI's senior management team over the long term."

HHI is a portfolio company of KPS Special Situations Funds (www.kpsfund.com).