Johnson Controls (JCI) has confirmed – in a one-sentence statement – that it remains interested in pursuing its proposal of acquiring assets of Visteon Corporation.
Last week (2 June) Visteon Corporation rejected an unsolicited US$1.25bn bid by JCI for its interiors and electronics businesses and said it would continue with its reorganisation plan “to emerge from bankruptcy as a strong, independent, stand-alone company”.
However, Johnson Controls sent a letter on Friday (4 June) to Visteon stating that it remains interested in the proposal.
Last week, in a letter released publicly, Visteon told JCI: “Without risk-adjusting your proposal, our careful analysis demonstrates that your acquisition of selected assets, while excluding certain liabilities, would accelerate other costs and would not significantly enhance recoveries to our creditors or provide recovery for our equity holders.
Additionally, the realisation of other risks associated with the proposed transaction would negatively impact our creditors and leave equity holders further removed from any recovery. It is also likely your proposal would involve a lengthy extension to the time we would remain in bankruptcy, which could undermine much of the successful work we have done to emerge as a strong company in the sector.”
The surprise Johnson Controls cash bid on 21 May was said by analysts to have underscored expectations for a steady recovery in global auto sales.
In bankruptcy, key Ford supplier Visteon has overhauled its operations and balance sheet and first quarter profit soared to $233m from $2m a year earlier.
The two units Johnson Controls proposed buying had $6bn in revenue in 2008, the last full year before Visteon filed for bankruptcy. The deal would have more than doubled Johnson Controls’ revenue in the booming Chinese market to over $7bn in 2011.