The joint venture that was created less than two years ago to capitalize on the systems approach to automotive interiors has fizzled in the wake of one of the biggest supplier acquisitions of 1999.
Corp. is acquiring from Donnelly Corp. its 50% share of Lear Donnelly Overhead Systems LLC, a 50-50 joint venture launched in September 1997 to produce modular headliners equipped with consoles, lights, electronic components and grab handles. Terms were not disclosed.
makes headliners, but it needed Donnelly, of Holland, MI, for the lighting, consoles and electronics. When Lear acquired UT Automotive earlier this year for $2.3 billion, it got an electronics-rich company that also happens to make headliners, lighting products and consoles. That made the joint venture with Donnelly unnecessary.
With the acquisition, Lear now can fold in Donnelly's overhead lighting products, handles and consoles into the larger UTA operations.
Lear, however, will not get any facilities, as Donnelly retains its 128th Street plant in Holland and will prepare it for another product, perhaps mirrors, says a Donnelly spokesman. He says the sale is consistent with Donnelly's recent focus on core products such as mirrors and windows.
The joint venture has 1,200 employees in the U.S. and Europe. Donnelly is trying to find new jobs for those who were assigned to the joint venture and will not be going to Lear.
There were differences in operating styles between the two companies, the Donnelly spokesman admits. Industry analyst David Andrea cautioned at the launch of the company that 50-50 ventures are difficult because of uncertainty over who's in charge.