FCA plans to spin-off its Magneti Marielli subsidiary, which operates six plants in Mexico
Fiat Chrysler Automobiles (FCA) plans to spin-off Magneti Marelli, a subsidiary that manufactures lighting, engines, electronics, suspension and exhausts systems, in order to give it more flexibility to operate, Reuters reported citing sources familiar with the process.
The move could be announced by FCA CEO Sergio Marchionne when he unveils his new strategy plan on June 1, the sources said.
According to the report, once the spin-off is completed, Magneti Marielli could be worth between 3.6 and 5 billion euros (US$ 4.4 – 6.2 billion).
Magneti Marelli, which employs around 43,000 people and operates in 19 countries, had revenue of around 8.7 billion euros in 2017, according to analysts, and adjusted core earnings of around 840 million euros.
The company 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.