Visteon has agreed to sell its controlling stake in Halla Visteon Climate Control Corp. (HVCC) to private equity group Hahn & Company and Hankook Tire.

Visteon said that the under the agreement its stake of approximately 70% of HVCC is being sold for approximately US$3.6bn or 52,000 KRW/share.

The transaction, which is subject to regulatory reviews, shareholder approval and other conditions, is expected to be completed in the first half of 2015.

Visteon said that further details will be provided next month (January 13, 2015, at the Deutsche Bank 2015 Global Auto Industry Conference in Detroit) including "the resultant business structure that will support continued expansion of the electronics and connected car business."

"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 D. 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, which is well-positioned to capitalize on the emerging era of the connected vehicle."

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."

Analysts and investors have suggested that Visteon should streamline its business to maximise profits.

Halla Visteon Climate Control is the world's No. 2 automotive climate control supplier and Visteon owns a 70% stake. 

Show the press release

Visteon Reaches Agreement to Sell Ownership Interest in Halla Visteon Climate Control Corp. (HVCC) to Hahn & Co. and Hankook Tire

-- Transaction valued at approximately $3.6 billion USD

-- Sale expected to be completed in first half of 2015

-- HVCC customers will continue to benefit from company's well-recognized leadership team, innovative thermal management solutions and expanding market presence

-- Transaction sharpens Visteon's focus on automotive cockpit electronics business and connected car solutions



VAN BUREN TOWNSHIP, Mich., Dec. 17, 2014 /PRNewswire/ -- Visteon Corporation (NYSE: VC) today announced that it has entered into an agreement to sell its approximately 70 percent ownership interest in Halla Visteon Climate Control Corp. (HVCC) to an affiliate of Hahn & Company - a South Korea-based private equity company - and Hankook Tire Co. Ltd. for approximately $3.6 billion or 52,000 KRW/share.


The transaction represents an enterprise value for HVCC of approximately 10.1 times EBITDA for the 12 months ended Sept. 30, 2014. Visteon expects the ultimate tax exposure, after consideration of Visteon's tax attributes, to range between 10 percent and 14 percent as a function of final resolution of sovereign tax issues. The majority of proceeds have been hedged against currency movement.

The transaction, which is subject to regulatory reviews, shareholder approval and other conditions, is expected to be completed in the first half of 2015. Visteon management will provide greater details on the transaction on Jan. 13, 2015, at the Deutsche Bank 2015 Global Auto Industry Conference in Detroit - including the resultant business structure that will support continued expansion of the electronics and connected car business.

"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 D. 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, which is well-positioned to capitalize on the emerging era of the connected vehicle."

Leuliette added that Visteon will present an expanded portfolio of Cloud-based products and services, as well as the innovative SmartCore(TM) cockpit domain controller, at the 2015 International CES in Las Vegas on Jan. 6-9, 2015.

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. Customers of HVCC will continue to benefit from its globally renowned technology solutions, highly respected management team, strong balance sheet, dedication to innovation and expanding global market presence. Together in partnership with Hankook Tire, we believe we can help HVCC expand its customer base and global reach and further improve upon HVCC's operating efficiency and technological expertise. Both of our firms are confident that the current management team of HVCC will continue to deliver excellence to its customers, its employees and to its shareholders."

Advising Visteon on the transaction are Rothschild; UBS Investment Bank; and Skadden, Arps, Slate, Meagher & Flom LLP.

Halla Visteon Climate Control (HVCC) is a full-line supplier of automotive thermal management solutions. Products include heating ventilation and air conditioning; compressors; powertrain cooling; fluid transport; and electric, hybrid and fuel cell vehicle thermal systems. With 36 manufacturing sites supported by four global technical centers in 19 countries, HVCC employs nearly 15,500 people.
HVCC is traded on the Korea Stock Exchange (KS: 018880)

Original source: Visteon via PRNewswire

Auto market intelligence
from just-auto

• Auto component fitment forecasts
• OEM & tier 1 profiles & factory finder
• Analysis of 30+ auto technologies & more