) has announced a tender offer to purchase the remaining 30% of
Halla Climate Control Corp. The company, which already has a 70%
stake in Halla, will have a complete climate control portfolio
following the acquisition, which, in turn will greatly enhance its
Visteon's Korean subsidiary Visteon Korea Holdings Corp. has
made an offer of KRW 913 billion ($805 million) for buying of the
remaining 32 million shares of Halla. The offer is subject to
shareholders tendering a minimum of 26.7 million shares for at
least 95% ownership of Visteon.
The acquisition will improve Visteon's business in the climate
control segment with an efficient operating structure. Long-term
plans of the company to have a global presence in the climate
control of automotive will also have a favourable impact. In
addition, Halla's capability of developing advanced powertrain
cooling technologies will back Visteon's ongoing research and
development initiatives in the U.S. and Germany.
Visteon also expects that the deal will boost its earnings by 25
cents per share excluding operational and tax synergies. The
company anticipates roughly $20 million in synergies in the first
full year of integration.
Visteon has further plans to expand its foothold in Korea with
the establishment of the world's largest compressor production
unit. The expansion in the country will also lead to development of
advanced technologies for radiators, condensers, evaporators and
After acquiring a majority ownership of Halla from
Ford Motor Co.
) in 1999, Visteon has been lending support to Halla to become a
competitive global supplier with a sound reputation in Korea.
However, the deal faces certain challenges from National Pension
Service which holds about 10% of Halla's share. Hyundai Motor
Co., the biggest customer of Halla is also not very satisfied with
Visteon is one of the leading global automotive suppliers
engaged in designing, engineering and manufacturing innovative
climate, electronic, interior and lighting products for vehicle
manufacturers. Currently, it retains a Zacks #3 Rank, which
translates into a short-term (1 to 3 months) "Hold" rating.%
FORD MOTOR CO (F): Free Stock Analysis Report
VISTEON CORP (VC): Free Stock Analysis Report
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