VAN BUREN TOWNSHIP, Mich. (AP) — Auto parts supplier Visteon Corp. said Thursday it agreed to sell its largest U.K. operation to Canadian auto parts maker Linamar Corp., as part of the company's three-year restructuring plan designed to save about $400 million a year.
The company signed a memorandum of understanding to sell its facility located in Swansea. Visteon said its U.K. subsidiary, which includes the Swansea plant, lost about $110 million on revenue of $540 million in 2006. Specific financial results for the plant alone weren't disclosed.
Visteon will transfer the manufacturing facility and related assets, as well as contracts and certain intellectual property rights to Linamar. The 400 employees currently working at the facility are also expected to transfer to the new owner.
Financial terms weren't disclosed.
The deal is expected to be completed by year-end, subject to due diligence, certain third-party agreements, a definitive agreement, antitrust clearance and corporate approvals. The sale will complete Visteon's divestiture of its chassis business.
Under its restructuring plan, Visteon has exited its brake business and laid off a significant number of salaried workers in the U.K. Nearly 60 percent of Visteon's hourly manufacturing personnel are now in lower-cost countries, compared with 48 percent at the end of 2005. By 2009, Visteon plans to have 75 percent of its manufacturing personnel and half of its engineering workforce outsourced to lower-cost countries.
Shares rose a penny to $5.77 in afternoon trading.
