US: Visteon agrees to sell its stake in HVCC

By Dave Leggett | 18 December 2014

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.