Photo: Magneti Marelli
It’s been years since Sergio Marchionne first let it slip that he would like to spin off Magneti Marelli from Fiat Chrysler Automobiles. Had he been alive, Marchionne would have been proud of his peers for managing to sell the automotive juggernaut to Calsonic Kansei for €6.2 billion.
Now known as Magneti Marelli CK Holdings, the company is estimated to bring €15.2 billion in revenue, translating to one of the largest automotive components suppliers in the world. As part of the deal, Fiat Chrysler has announced that it will enter into “a multi-year supply agreement” with the newly-formed enterprise.
“This is a transformational day for both Magneti Marelli and Calsonic Kansei,” said chief executive officer Ermanno Ferrari, “creating as it does a global business of exceptional range, reach, expertise, and future prospects. This is a moment of great opportunity for all our people to be part of a secure, growing, and independent company of considerable scale that can look to the future with energy, ambition, and confidence."
Calsonic Kansei was established 80 years ago, featuring manufacturing centers in places as far apart as Japan, Romania, China, France, the United States, South Korea, Mexico, Thailand, Spain, Malaysia, and the United Kingdom. Nissan used to hold as much as 41.7 percent of the shares, by the private equity firm known as KKR eventually bought those shares in 2016. In other words, the U.S.-based investment management company has control over Calsonic Kansei and Magneti Marelli.
Specialized in lighting, powertrain, and electronics, Magneti Marelli is responsible for Fiat Chrysler shares shooting up on the stock exchange. Selling Magneti Marelli boosts the net cash position of the Italo-American automotive group, which could translate to a buyback of shares at some point in the future.
Goldman Sachs and JP Morgan were the financial advisers to FCA on the deal, which hasn’t been closed at the time of writing. The automaker expects a closure by mid-2019, following regulatory approvals and various other procedures.
“The combined business will continue to be among FCA’s most important business partners and we would like to see that relationship grow even further in the future,” declared Mike Manley, chief executive officer of Fiat Chrysler Automobiles.
“This is a transformational day for both Magneti Marelli and Calsonic Kansei,” said chief executive officer Ermanno Ferrari, “creating as it does a global business of exceptional range, reach, expertise, and future prospects. This is a moment of great opportunity for all our people to be part of a secure, growing, and independent company of considerable scale that can look to the future with energy, ambition, and confidence."
Calsonic Kansei was established 80 years ago, featuring manufacturing centers in places as far apart as Japan, Romania, China, France, the United States, South Korea, Mexico, Thailand, Spain, Malaysia, and the United Kingdom. Nissan used to hold as much as 41.7 percent of the shares, by the private equity firm known as KKR eventually bought those shares in 2016. In other words, the U.S.-based investment management company has control over Calsonic Kansei and Magneti Marelli.
Specialized in lighting, powertrain, and electronics, Magneti Marelli is responsible for Fiat Chrysler shares shooting up on the stock exchange. Selling Magneti Marelli boosts the net cash position of the Italo-American automotive group, which could translate to a buyback of shares at some point in the future.
Goldman Sachs and JP Morgan were the financial advisers to FCA on the deal, which hasn’t been closed at the time of writing. The automaker expects a closure by mid-2019, following regulatory approvals and various other procedures.
“The combined business will continue to be among FCA’s most important business partners and we would like to see that relationship grow even further in the future,” declared Mike Manley, chief executive officer of Fiat Chrysler Automobiles.
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