-- 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,
Michigan, 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.
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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™ 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)
About Visteon
Visteon Corporation is a
global automotive supplier that designs, engineers and manufactures
innovative products for nearly every vehicle manufacturer
worldwide. Visteon delivers value for its customers and
shareholders through two technology-focused core businesses:
vehicle cockpit electronics and thermal energy management. Visteon
owns 70 percent of Halla Visteon Climate Control Corp., the world's
second largest provider of vehicle thermal management solutions.
With corporate offices in Van Buren
Township, Mich. (U.S.); Shanghai,
China; and Chelmsford, UK;
Visteon has more than 26,000 employees at facilities in 29
countries. Visteon had sales of $7.4
billion in 2013. Learn more at www.visteon.com.
Forward-looking Information
This press release contains "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements are not guarantees of future
results and conditions but rather are subject to various factors,
risks and uncertainties that could cause our actual results to
differ materially from those expressed in these forward-looking
statements, including, but not limited to: (1) conditions within
the automotive industry, including (i) the automotive vehicle
production volumes and schedules of our customers, (ii) the
financial condition of our customers and the effects of any
restructuring or reorganization plans that may be undertaken by our
customers or suppliers, including work stoppages, and (iii)
possible disruptions in the supply of commodities to us or our
customers due to financial distress, work stoppages, natural
disasters or civil unrest; (2) our ability to satisfy future
capital and liquidity requirements; including our ability to access
the credit and capital markets at the times and in the amounts
needed and on terms acceptable to us; our ability to comply with
financial and other covenants in our credit agreements; and the
continuation of acceptable supplier payment terms; (3) our ability
to satisfy pension and other post-employment benefit obligations;
(4) our ability to access funds generated by foreign subsidiaries
and joint ventures on a timely and cost-effective basis; (5) our
ability to execute on our transformational plans and cost-reduction
initiatives in the amounts and on the timing contemplated; (6)
general economic conditions, including changes in interest rates,
currency exchange rates and fuel prices; (7) the timing and
expenses related to internal restructurings, employee reductions,
acquisitions or dispositions and the effect of pension and other
post-employment benefit obligations; (8) increases in raw material
and energy costs and our ability to offset or recover these costs,
increases in our warranty, product liability and recall costs or
the outcome of legal or regulatory proceedings to which we are or
may become a party; and (9) those factors identified in our filings
with the SEC (including our Annual Report on Form 10-K for the
fiscal year ended Dec. 31,
2013).
Caution should be taken not to place undue reliance on our
forward-looking statements, which represent our view only as of the
date of this release, and which we assume no obligation to
update.
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