Visteon Corp. (VC), the auto-parts maker shopping two of its four units, agreed to sell its lighting division to Varroc Group of India for $92 million, Visteon said today in a statement.
The unit, which supplies automotive exterior lights, had revenue of $531 million last year. Visteon said it expects the transaction to close in the third quarter. Visteon said last month it took a noncash writedown of $66 million for the lighting unit in the fourth quarter.
“This transaction allows Visteon to focus on our core climate and electronics businesses and our joint venture relationships, which are positioned for profitable growth and market leadership,” Don Stebbins, Visteon’s chief executive officer, said in the statement.
Shedding the unit is part of management’s plan for Visteon, which exited a 16-month bankruptcy in 2010, to pare lower-margin revenue in interiors and lighting and focus on faster-growing operations in Asia, five people familiar with the sales process said in October.
Varroc is an Aurangabad, India-based supplier of parts for passenger and commercial vehicles and motorcycles. Varroc’s customers include Honda Motor Co. (7267), Yamaha Motor Co., Fiat SpA (F), General Motors Co., Caterpillar Inc. and Visteon, according to its website.
Unit Employs 4,200
Visteon slipped 0.4 percent to $52.89 at the close in New York. The shares have gained 5.9 percent this year after dropping 33 percent last year.
The unit employs about 4,200 people and has facilities in Novy Jicin and Rychvald, Czech Republic; Monterrey, Mexico, and Pune, India.
About 81 percent of the unit’s revenue comes from North America and Europe, the company said in a July presentation. The unit’s gross margin, which measures gross profit as a percentage of revenue, is 2.6 percent, according to the presentation.
Visteon, based in Van Buren Township, Michigan, is a former unit of Ford Motor Co. (F)
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