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Peregrine Creditors Approve Settlement with Peregrine, General Motors

22 December 1998

Peregrine Creditors Approve Settlement with Peregrine, General Motors

    SOUTHFIELD, Mich., Dec. 21 -- Peregrine Incorporated's trade
creditors have approved a settlement with the company and General Motors
, signaling acceptance of the automotive supplier's out-of-court
plan of reorganization, Peregrine's Informal Unsecured Creditors' Committee
announced today.
    The settlement was approved by 91.5 percent of the creditors whose debts
were frozen at the time of the April announcement of Peregrine's sale to
Peregrine Acquisition, Inc.  Under the settlement, General Motors --
Peregrine's major customer -- will fund up to $20 million for payments of
trade suppliers' claims that were frozen by Peregrine last spring.
    Trade suppliers under this settlement will receive about one-third of the
frozen debt owed to them.  The company has been paying for goods and services
received after April 24 on an ongoing basis.
    "The cooperation of all parties, including the unsecured creditors'
committee, the creditors themselves and General Motors helped move these
negotiations along steadily," said Peregrine Incorporated Chairman Jay Alix,
"Creditor approval of the out-of-court settlement now clears the way for us to
focus 100 percent of our efforts an the completion of our turnaround plan."
    Peregrine President and Chief Executive Officer James Bonsall said
significant progress has been made on the turnaround plan over the last
several months.  The closure of the company's Flint plant is scheduled to be
completed within the next couple weeks.  The Livonia plant will continue to
operate to complete model-year buildout on some remaining products and will be
closed by late spring 1999.  The sale of the company's Windsor, Ont. facility
also is moving ahead.
    Continuing Operations in the company's Michigan and Canada plants have
landed more than $85 million in new work, Bonsall said.
    Another key objective of the Alix-led restructuring was to place the Flint
and Livonia workers back at General Motors.  The company announced it had
achieved this key milestone in September.
    The combination of the creditors agreement and the preservation of jobs,
along with the rest of the Alix-designed turnaround, brings to completion the
complex, fast-paced restructuring designed and implemented by Jay Alix &
Associates.
    "Peregrine's new management and its employees have consistently met goals
and kept promises throughout the turnaround process," Bonsall said.  "We're
very pleased that our entire turnaround effort has proceeded either on or
ahead of schedule.
    "This settlement is extremely good news for our customers, suppliers and
employees.  It demonstrates that our suppliers share our faith in the future
of the company."