Calsonic Kansei acquires Magneti Marelli for US$7.14 billion; deal includes six plants in Mexico
Fiat Chrysler Automobiles N.V. (FCA) announced it has entered into a definitive agreement to sell its automotive components business Magneti Marelli S.p.A. to CK Holdings Co., Ltd., a holding company of Calsonic Kansei Corporation, a Japanese automotive component supplier.
Following the closing of the Transaction, CK Holdings will be renamed as Magneti Marelli CK Holdings. The combined businesses of Calsonic Kansei and Magneti Marelli will create the world’s seventh largest global independent automotive components supplier based on total revenues.
The agreement represents a transaction value of around US$7.14 billion. The transaction is expected to close in the first half of 2019 and is subject to regulatory approvals and other customary closing conditions.
The transaction represents a unique opportunity to combine two successful businesses to create one of the leading global independent automotive components suppliers, having combined revenues of US$17.5 billion. The combination is a decisive step towards both companies’ strategic ambition to become a leading globally-diversified tier-1 supplier.
The combined company will be well positioned to serve its customers around the world due to its enhanced scale, financial strength and the highly complementary nature of its combined product lines and geographic footprint. The new entity will operate out of nearly 200 facilities and Research and Development (R&D) centers across Europe, Japan, the Americas, and Asia Pacific.
Magneti Marelli operates six manufacturing plants in four Mexican cities. Two facilities located in Ciudad Juarez, Chihuahua, are dedicated to the production of lighting products, while a production site in Saltillo, Coahuila, builds suspension systems.
A facility in Toluca, State of Mexico, builds both lighting products and exhaust systems. Another two plants in Tepotzotlan, State of Mexico, are each dedicated to the manufacture of lighting components and electronics such as mechatronics, instrument clusters, telematics and satellite navigation.
FCA has also agreed to a multi-year Supply Agreement that will further strengthen a mutually beneficial relationship for both Magneti Marelli and FCA’s expanding model range and which will sustain Magneti Marelli’s Italian business operations, positioning it strongly for continued growth and success in the future.
The combined company will be led by Beda Bolzenius, currently CEO of Calsonic Kansei, based in Japan. Ermanno Ferrari, CEO of Magneti Marelli, will join the Magneti Marelli CK Holdings board.
KKR acquired Calsonic Kansei from Nissan in 2016 for US$1.87 billion. The deal included five production sites in Mexico. Three facilities in Aguascalientes dedicated to Air-Conditioning Systems, Heat Exchange Systems, Exhaust Systems, Meters, Plastic Components, Instrument Panels and Wiring Harness Components.
The agreement also included a production unit in Durango that manufactures Heater Units, Air-Conditioning System Parts and Radiators, and a plant in Mexico City that creates Mufflers (Silencers).
– Anti-trust authorities clear Grammer AG’s acquisition of Toledo Molding & Die
– Korea-based Hanon Systems acquires Magna’s fluid controls business for US$1.23 billion
– Tenneco stockholders approve acquisition of Federal-Mogul, including 15 plants in Mexico