|By Marketwired .||
|September 30, 2013 08:36 AM EDT||
TORONTO, ONTARIO -- (Marketwired) -- 09/30/13 -- Martinrea International Inc. (TSX:MRE), a leader in the production of quality metal parts, assemblies and modules and fluid management systems focused primarily on the automotive sector, announced today that it had obtained a copy of the claim filed by Nat Rea, Rea Holdings Inc. and one other person (who has not previously communicated any concerns to the Board or senior management), making certain allegations against the Company, certain directors and officers, and two Martinrea suppliers. The claim has not been served. The Company convened board meetings on the weekend to review the claim, which raises two general sets of historical concerns.
The first set of concerns, which comprise the bulk of the issues advanced in the claim, were first raised in early 2011, while Mr. Rea was still an officer and director and a major shareholder of the Company. Matters specifically raised by Mr. Rea were the subject of a review by the Chair of the Audit Committee, with full access to management resources and Company records, who presented his findings to the Audit Committee and the full Board. At the time, Mr. Rea indicated in writing that all his concerns had been addressed: "I am now content with the actions taken by the board as outlined in Suleiman Rashid's report. I apologize for any inconvenience and let's grow the business." With Mr. Rea's concurrence, the Board determined that further steps were not warranted.
A second set of concerns was recently raised by Mr. Rea and Mr. Enzo Cirillo in a meeting with Nick Orlando, the Company's CEO. Mr. Rea has advised that a tape recording was made of the meeting, but has not responded to the Company's request for a copy thereof. The allegations appear to involve payments totaling approximately $250,000 made by the Company and one of its subsidiaries purportedly for the benefit of Fred Jaekel in 2002 and 2006. The Board was immediately notified, retained independent legal counsel and is well advanced in a full investigation of the matters, following which the Board will take appropriate actions.
While the claim has not been served, the Company is preparing its Statement of Defence which it intends to file promptly.
Mr. Jaekel was the Company's CEO until February 2011. Mr. Rea was Vice Chairman of Martinrea until June, 2012, when his employment was terminated, he resigned as a director, and he sold his remaining shares in Martinrea.
The Company anticipates that 2013 will be a year of record revenues and profits. The Company's second quarter results were the best quarterly results in its history. Management remains singularly focused on continuing to build a better company and enhancing value for Company shareholders. The Board will continue to act in the best interests of its shareholders and fulfill its fiduciary obligations.
This press release contains forward looking statements within the meaning of applicable Canadian securities laws including expectations on revenues and profits for the 2013 fiscal year. Forward-looking statements are based on estimates and assumptions made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments, as well as other factors that the Company believes are appropriate in the circumstances. Many factors could cause the Company's actual results, performance or achievements to differ materially from those expressed or implied by the forward-looking statements, including the risk factors discussed in detail in the Company's Annual Information Form and other public filings which can be found at www.sedar.com.
The common shares of Martinrea trade on The Toronto Stock Exchange under the symbol "MRE".
Martinrea International Inc.
(289) 982-3001 (FAX)