US auto parts maker Visteon to sell majority stake in Halla Visteon for $3.6 bn
18 Dec 2014
US auto parts maker Visteon Corp today agreed to sell its majority 70-per cent stake in South Korean unit Halla Visteon Climate Control Corp (HVCC) to local private equity firm Hahn & Co and tyre maker Hankook Tire, for $3.6 billion.
Hahn & Co will hold a 50.5-per cent stake in HVCC, while Hankook - South Korea's biggest tyre maker, will hold 19.49 per cent.
The sale comes seven months after Visteon agreed to sell a majority of its global automotive-interiors business to Cerberus Capital Management as part of its plan to focus on its cockpit electronic ecosystems businesses and connected car segment.
''HVCC is a solid business with innovative technology, a broad global footprint and a strong business backlog, thanks to a seasoned management team and record business wins in 2014,'' said Visteon president and CEO, Timothy Leuliette. ''We feel this is an opportune time to create additional value for shareholders by selling our ownership interest in HVCC and concentrating on our cockpit electronics and connected car portfolio.''
Scott Hahn, CEO of Hahn & Co, said, ''HVCC is Korea's largest and the world's second largest provider of thermal management solutions and will be an excellent fit within our existing portfolio and strategy.''
HVCC, spun off from Ford Motor Company in 2000, was earlier a joint venture between Ford and Halla Group's subsidiary Mando Corp, from whom Visteon acquired the stake during the Asian financial crisis in the late 1990s.
Based in Daejeon, South Korea, HVCC manufactures automobile climate control products in Korea, Europe, China, and the US.
HVCC, whose clients include Ford, Tata Motors, Volvo, Audi, BMW among others, makes heating, ventilation, air conditioning, compressors, powertrain cooling, fluid transport, and electric, hybrid and fuel cell vehicle thermal systems.
It has an extensive network of 36 manufacturing sites, four R&D centers, seven customer centers around the world and nearly 15,500 employees.
The company posted net profit of $296 million last year on revenues of $5.2 billion.