Another automotive supplier is on the block, as United Technologies Corp. reportedly is interested in selling its auto parts operations, United Technologies Automotive, by summer's end.
Looking to cut costs, UTC earlier in the year said that it had retained Goldman, Sachs & Co. to explore strategic alternatives for its automotive business, reportedly worth $2 billion. With consolidation fever striking the auto parts sector, there is a need to grow significantly or explore other options, Chief Executive George David said at the time.
Now, the company, which provides high technology products and support services to the building systems, automotive and aerospace industries, may be considering offers from serious bidders while making presentations to interested parties.
|2/18/'99||% Chg. |
|% Chg. |
Yr. to Date
|Note: This index is a weighted average with a 100-point base figured from 1/2/97. For details see Ward's Automotive Reports, Jan. 18, '99, insert. |
Source: Ward's/Roney Capital Markets.
The automotive business, which had 1998 revenues of $2.96 billion, saw operating profit for the fourth quarter decline 43% on 3% revenue growth due to factors including higher spending related to future programs, customer pricing pressures and a write-off at an interior trim plant, the supplier says.
In other supplier news: JPE Inc. sells the assets of its Canadian subsidiary, JPE Canada Inc. Proceeds will be used to reduce amounts owed to JPEC's secured bank lender. Also, the supplier agrees to sell all of the assets and business of its wholly owned subsidiary, Industrial & Automotive Fasteners Inc., to MacLean-Fogg Co. of Mudelein, IL, for cash plus the assumption of certain liabilities. Borg-Warner Automotive Inc. receives approval from the German merger control authority, the Bundeskartellamt, to proceed with the company's acquisition of Kuhlman Corp. Kuhlman stockholders will vote on the merger at a special meeting March 1. Illinois Tool Works Inc. completes the acquisition of Trident International Inc. through the merger of its subsidiary, ITW Acquisition Inc., into Trident.Corp.'s Trucking Information Service Div. receives more than $7 million in contracts for the purchase of its new transportation logistics management system, Fleet Advisor.
The Ward's Supplier Index lost 1.8% for the period ending Feb. 18. With the erosion, the Index is off 3.8% for the year. Losers led gainers 58-16 with one stock unchanged. Few stocks showed significant improvement but Autocam dropped dramatically on predictions it will have a weak third quarter. Federal-Mogul also continues to slide as it regroups from the failed bid for LucasVarity.