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Walbro Corp. Announces Restructuring Plan for Q4

20 November 1997

Walbro Corporation Announces Restructuring Plan, Will Take a Charge in the Fourth Quarter

    CASS CITY, Mich., Nov. 20 -- Walbro Corporation
today announced a plan for restructuring its operations.  L.E.
Althaver, Chairman and Chief Executive Officer, Walbro Corporation, made the
announcement.
    "The purpose of the restructuring plan is to allow us to better focus on
our core activities, eliminate under-performing operations, lower our cost
structure and enhance shareholder value," Althaver said.  "As a result of the
restructuring, Walbro will be better able to take advantage of growth
opportunities in its core businesses."
    "The restructuring is expected to result in special charges aggregating
between $20 million and $25 million pre-tax in the fourth quarter of 1997,
resulting in a loss for the quarter and for the year.  In addition, the
Company will take a non-recurring charge of approximately $5 million pretax
for warranty costs which became known in the fourth quarter," Althaver said.
    "The actions outlined below are expected to increase margins and add to
earnings before interest and taxes by approximately $11-14 million per year,"
according to the Walbro chief executive.  "We expect the full-year benefit of
these actions to be realized within the next 18 months."
    "As part of the plan, Walbro will divest itself of its Ligonier, Indiana,
steel fuel rail production facility.  The combination of lower volumes and
extensive cost pressures has reduced profitability at this facility," Althaver
said.  "Walbro will continue to produce plastic fuel rails at its facility in
Meriden, Connecticut."
    "In response to strong pricing pressures and delays in customer programs,
we will restructure Walbro's Asia-Pacific automotive activities," he said.
"We will also consolidate our small engine operations in the Asia-Pacific
region.  These operations have been negatively affected by government policy
changes, labor market conditions, strong local currencies and high logistical
costs."
    "In addition, we will restructure our European automotive fuel tank
operations to include a write-down of certain over-valued assets," Althaver
said.
    "Walbro will also dispose its interest in U.S. CoExcell Inc., a
manufacturer of blow-molded plastic drums in Maumee, Ohio, and Saginaw
Plastics, an injection molder in Saginaw, Michigan.  The ramp-up of fuel tank
production in Ossian, Indiana, and a new joint venture in Detroit have
resulted in a shift of focus from these non-strategic operations," Althaver
explained.  "In addition, we will write off obsolete equipment and inventory
as part of the plan."
    "Finally, we expect to reduce corporate-wide headcount by approximately 10
percent including reductions related to the planned divestitures and
restructuring," Althaver concluded.
    Walbro Corporation is a designer and manufacturer of precision fuel
systems and products for automotive and small engine markets.  Walbro
Corporation is headquartered in Cass City, Michigan, and has subsidiaries and
joint ventures throughout the world, including North and South America, Europe
and Asia.  Walbro common stock is traded on the Nasdaq National Market under
the symbol WALB.
    This press 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 due to certain risks and
uncertainties, including but not limited to general economic conditions in the
markets in which Walbro operates, fluctuations in the production of vehicles
for which Walbro is a supplier, labor disputes involving Walbro or its
significant customers, risks associated with conducting business in foreign
countries and other risks detailed from time to time in the Company's
Securities and Exchange Commission filings.

SOURCE  Walbro Corporation