Honda has agreed to sell its electronic parts subsidiary, Elesys, to Nidec Corporation.
The sale is reportedly worth 50 billion yen, according to Japanese media reports.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
The deal is part of a move for Honda and Nidec to cooperate in the growing field of electronic controls for cars, the Nikkei said.
The majority of the stake in the unit, Honda Elesys Co, held by Honda and NEC Corp, would be sold to Nidec as early as 2014, the newspaper said.
Nidec said in a statement that it is actively engaged in acquisitions of automotive motor businesses and that is one of the “world-leading electronics system manufacturers that develops, manufactures and sells electronic control units for automobiles”.
It also said that in the market of electric power steering (EPS) motors, integration with electronic control unit (power-pack) is increasingly required. By combining the company’s EPS motors with Elesys’ electronic control units (ECU), the motor business has the “potential to be transformed into a module business, facilitating a great stride for the company toward the goal to be the ‘world’s top global mega supplier’ in the area of automotive components”.
It added that by utilising Nidec Group’s sales network for automotive motors, sales synergies are also anticipated as Elesys is expected to have a greater opportunity to sell its products beyond the Honda group.
Elesys is described as a “front-runner of research and development in the area of advanced safety technologies (adaptive cruise control, lane keeping assist, motion adaptive EPS and collision damage mitigation system, etc.)”. Nidec added that “this area will be further explored by utilizing the management resources of Nidec Group”.
