Visteon, Ford Sign Definitive Agreements for New Business Arrangement; Anticipate Completing Transaction Oct. 1
13 September 2005 - 11:08PM
PR Newswire (US)
VAN BUREN TOWNSHIP, Mich., Sept. 13 /PRNewswire-FirstCall/ -- .
Visteon Corporation (NYSE:VC) announced today that it has signed
definitive agreements with Ford Motor Company, outlining terms and
conditions of a new business arrangement announced by the two
companies on May 25, 2005. Visteon and Ford anticipate closing the
transaction on Oct. 1. (Logo:
http://www.newscom.com/cgi-bin/prnh/20001201/DEF008LOGO ) The
definitive agreements are closely aligned with the memorandum of
understanding (MOU) announced by Visteon and Ford on May 25,
covering significant structural changes to Visteon's North American
manufacturing operations, including the transfer of 23 facilities
to a Ford-managed legal entity, Automotive Components Holdings,
LLC. The transaction will increase Visteon's competitiveness by
streamlining and improving the cost structure of its North American
operations. "This is an important step on our path to creating a
more competitive North American structure, a more diversified
customer portfolio and a balanced global footprint to ensure we are
a profitable, globally competitive supplier," said Visteon Chairman
and Chief Executive Officer Mike Johnston. "As we move closer to
completing this transaction, we are progressing with plans for
significant additional restructuring actions over the next several
years to achieve our goal of being a winning automotive supplier.
Throughout this transition, we remain focused on providing our
customers with high- quality products and services." Visteon will
create a new organization focused on supporting the operations of
Automotive Components Holdings in areas such as manufacturing,
customer support, product development, materials
management/purchasing, quality, finance, human resources,
information technology and facilities management. Jim Palmer,
Visteon executive vice president and chief financial officer, said
Visteon and Ford have worked diligently to define how Visteon will
support Automotive Components Holdings after the transaction is
completed. "We anticipate that approximately 5,000 salaried Visteon
employees in North America will support Automotive Components
Holdings, which will reimburse Visteon for the cost of these
employees," Palmer said. "Our focus throughout this process has
been to ensure that the mutual goals of Visteon and Automotive
Components Holdings are achieved." The agreements will reshape
Visteon from a company that had $18.7 billion in revenue in 2004 to
a leaner, more competitive $11.4 billion organization, based on
estimated 2005 pro forma revenue. Visteon will focus its
engineering and capital resources on products that have been
generating significant new business with major vehicle
manufacturers .- interiors, climate control and electronics,
including lighting. Visteon has significant global scale in these
products and intends to strengthen its position through a more
focused investment in capital, people and technology. When the
transaction is completed, the plants and facilities that Visteon
will transfer to Automotive Components Holdings include 13
facilities in Michigan; two each in Ohio and Tennessee; one each in
Indiana, Missouri and Oklahoma; and three in Mexico. (See attached
list.) Visteon expects to recognize a significant gain related to
the closing of the transaction, primarily associated with the
relief of liabilities pertaining to the new business arrangement.
This gain is expected to be well in excess of the $1.1 billion
non-cash charge related to the transaction that Visteon reported
for the second quarter 2005. Visteon and Ford have received U.S.
anti-trust and union approvals for the transaction. Visteon
Corporation is a leading full-service supplier that delivers
consumer-driven technology solutions to automotive manufacturers
worldwide and through multiple channels including the global
automotive aftermarket. Visteon has about 70,000 employees and a
global delivery system of more than 200 technical, manufacturing,
sales and service facilities located in 24 countries. This press
release contains "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. Forward-
looking statements are not guarantees of future results and
conditions but rather are subject to various factors, risks and
uncertainties that could cause our actual results to differ
materially from those expressed in these forward-looking
statements, including the automotive vehicle production volumes and
schedules of our customers, and in particular Ford's North American
vehicle production volumes; our ability to close the transactions
that are contemplated in the agreements with Ford; implementing
structural changes that result from the closing of the transactions
contemplated by the Ford agreements in order to achieve a
competitive and sustained business; our ability to satisfy our
future capital and liquidity requirements and comply with the terms
of our credit agreements; the results of the investigation being
conducted by Visteon's Audit Committee and the company's inability
to make timely filings with the SEC; the financial distress of our
suppliers; our successful execution of internal performance plans
and other cost-reduction and productivity efforts; charges
resulting from restructurings, employee reductions, acquisitions or
dispositions; our ability to offset or recover significant material
surcharges; the effect of pension and other post- employment
benefit obligations; as well as those factors identified in our
filings with the SEC (including our Annual Report on Form 10-K for
the year- ended December 31, 2004). We assume no obligation to
update these forward- looking statements. Upon completion of the
Ford transaction, Visteon will transfer the following facilities
(in alphabetical order by location): Plants-17 Other facilities-6
Plants Autovidrio Plant - Mexico (glass) Chesterfield Plant -
Chesterfield Twp, Mich. (seating foam) El Jarudo Plant - Mexico
(powertrain) Indianapolis Plant - Indianapolis, Ind. (steering
components) Kansas City Plant - Kansas City, Mo. (IP/lamp final
assembly & sequencing) Lamosa Plant I & II - Mexico
(chassis) Milan Plant-Milan, Mich. (powertrain) Monroe
Plant-Monroe, Mich. (chassis) Nashville Glass Plant - Nashville,
Tenn. (glass) Rawsonville Plant - Ypsilanti, Mich. (powertrain)
Saline Plant - Saline, Mich. (interiors) Sandusky Plant - Sandusky,
Ohio (lighting/air induction/fuel vapor storage) Sheldon Road Plant
- Plymouth, Mich. (climate) Sterling Plant - Sterling Heights,
Mich. (chassis) Tulsa Glass Plant - Tulsa, Okla. (glass) Utica
Plant - Shelby Twp, Mich. (interiors, exteriors) Ypsilanti Plant -
Ypsilanti, Mich. (chassis) Research, Testing and other facilities
Bellevue Facility - Bellevue, Ohio (aftermarket parts &
distribution) Carlite Warehouse - Lebanon, Tenn. (glass
distribution center) Commerce Park South - Bldg D-Dearborn, Mich.
(chassis engineering/glass lab) Glass Systems Main Office - Allen
Park, Mich. (glass) Product Assurance Center - Dearborn, Mich.
(research & development, testing) Technical Center - Dearborn,
Mich. (research & product development, support)
http://www.newscom.com/cgi-bin/prnh/20001201/DEF008LOGODATASOURCE:
Visteon Corporation CONTACT: Media: Jim Fisher, +1-734-710-5557, ,
Investor Inquiries: Derek Fiebig, +1-734-710-5800, Web site:
http://www.visteon.com/
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