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Valeo
mum on joint bid with Tata; shareholder seeks review of
Visteon strategy
21
May 2007
Mumbai:
Valeo, Europe's biggest listed car parts group, said it
had no comment to make on an Indian newspaper report that
it would team up with Tata AutoComp Systems to buy a stake
in Visteon Corp.
"We
have no comment," a company spokeswoman said, noting
the group's executives were preparing for the annual shareholders
meeting.
While
the report said a deal could be valued at between $1.5-$2
billion, it did not make it clear whether the two firms
would jointly or independently bid for Visteon, an ailing
unit that was spun off from car maker Ford Motor Co in
2005.
Visteon
makes electronic items, powertrain controls, engine induction,
chassis and lighting for vehicle manufacturers. The company
registered a net loss of $153 million on sales of $2.93
billion in the March quarter.
Meanwhile,
Valeo's biggest single shareholder, US investment fund
Pardus Capital Management, is seeking with its 14-per
cent stake to get eight seats on the supervisory board
of Valeo and wants the French auto components maker to
start a strategy review of linking with Visteon, in which
Pardus has a 17-per cent stake.
Valeo's
management is against a full tie-up with Visteon, having
considered such a move in 2006, but said it could be interested
in any assets Visteon or Delphi Corp, GM's former auto
components subsidiary, put on the market as part of their
restructurings.
The
Valeo board is also in talks with investment funds about
a possible buy-out and expects to complete these talks
in June.
Tata
AutoComp, an original equipment supplier to major domestic
and multinational carmakers, sees the acquisition as a
strategic fit and has appointed a merchant banker.
Pardus,
which controls 14.2 per cent in Valeo, said it wants Valeo
to explore all options and it is not single-minded in
its view the French car parts maker should acquire all
of Visteon Corp's business.
"We
believe Visteon's thermal assets would be very synergistic
for Valeo and should be considered by the new board, along
with the full range of other options available to Valeo,"
Thomson Financial News quoted Joseph Thornton, portfolio
manager at Pardus, as saying.
He
said it was misleading for Valeo chairman Thierry Morin
to claim Pardus is single-"minded" on Visteon.
"We
are not. We want all options explored, including an orderly
LBO (leveraged buyout) process, and the best strategy
for Valeo  defined and
implemented," Thornton said.
Valeo
said later that day that it was continuing to examine
'expressions of interest' from investments funds and from
"one fund in particular".
Other
reports on Tata Autocomp Systems
Other
reports on auto ancillaries
Other
reports on M&A
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