Visteon Completes Sale of Its Swansea, UK, Operation; Provides Restructuring and Improvement Plan Update
08 July 2008 - 4:56AM
PR Newswire (US)
VAN BUREN TOWNSHIP, Mich., July 7, 2008 /PRNewswire/ -- Visteon
Corporation (NYSE:VC) has completed the sale of its Swansea, United
Kingdom, operation to Linamar Corporation, a Canadian-based auto
parts manufacturer. The Swansea sale represents a significant
milestone in Visteon's effort to address non-core facilities and
improve its financial performance in connection with its three-year
improvement plan. (Logo:
http://www.newscom.com/cgi-bin/prnh/20001201/DEF008LOGO ) "We are
making solid progress in addressing the financial performance of
our UK operations and this is an important step in that process,"
said Donald J. Stebbins, Visteon president and chief executive
officer. "This sale is the result of significant efforts to find a
viable alternative for the chassis operations at the Swansea plant,
which are not aligned with Visteon's core product groups." The
Swansea operation, Visteon's largest operation in the UK, generated
negative gross margin of approximately $40 million on sales of
approximately $80 million during 2007. The company transferred
certain Swansea-related assets to a newly created and wholly-owned
entity whose shares were acquired by Linamar for nominal cash
consideration. Visteon expects to record losses approximating $50
million in connection with this transaction, of which approximately
$15 million is expected to be reimbursed from the restructuring
escrow account. In addition to the sale of Swansea, in the second
quarter of 2008 Visteon also completed the planned closure of two
non-core fuel tank facilities in Germany and ceased production at
its operation in Bedford, Indiana, USA. These actions bring the
number of completed actions to 23 of 30 previously identified
restructuring actions under Visteon's improvement plan.
Furthermore, Visteon has previously announced its intention to
close its fuel tank facility in Missouri early in the third quarter
of 2008, after which only six restructuring actions will remain.
Visteon continues to take additional actions to improve its cost
structure. In June, the company announced its intention to close
its interiors facility in Durant, Mississippi, USA and consolidate
production into other existing facilities. The company has also
taken steps to address its capital structure and reduce its near
term debt maturities. In June, Visteon repurchased $344 million in
aggregate principal amount of its senior notes due in 2010 and
issued $206 million in aggregated principal amount of new senior
notes due in 2016. "Our significant restructuring efforts have
resulted in fundamental improvements in our global operations as we
continue to focus on our core products," Stebbins said. "We have
been focused on implementing our restructuring actions on schedule
and accelerating our plan wherever possible. Although the
automotive industry is facing very difficult times in North
America, this region represents less than 30 percent of Visteon's
total sales. Production decreases by North American automakers are
being largely offset by growth in other regions of the world,
particularly in Asia. Our diversification by customer and
geography, coupled with our improvement actions, has allowed
Visteon to continue to improve its financial performance during the
first half of 2008, despite the difficult North American market.
This improved financial performance will be discussed during
Visteon's conference call announcing our second quarter results."
Visteon Corporation is a leading global automotive supplier that
designs, engineers and manufactures innovative climate, interior,
electronic and lighting products for vehicle manufacturers, and
also provides a range of products and services to aftermarket
customers. With corporate offices in Van Buren Township, Mich.
(U.S.); Shanghai, China; and Kerpen, Germany; the company has
facilities in 26 countries and employs approximately 40,000 people.
Forward-looking Information 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 general
economic conditions, changes in interest rates and fuel prices; the
automotive vehicle production volumes and schedules of our
customers, and in particular Ford's vehicle production volumes;
work stoppages at our customers; our ability to satisfy our future
capital and liquidity requirements and comply with the terms of our
existing credit agreements and indentures; the financial distress
of our suppliers, or other significant suppliers to our customers,
and possible disruptions in the supply of commodities to us or our
customers due to financial distress or work stoppages; our ability
to timely implement, and realize the anticipated benefits of
restructuring and other cost-reduction initiatives, including our
multi-year improvement plan, and our successful execution of
internal performance plans and other productivity efforts; the
timing and expenses related to restructurings, employee reductions,
acquisitions or dispositions; increases in raw material and energy
costs and our ability to offset or recover these costs; the effects
of reorganization and/or restructuring plans announced by our
customers; the effect of pension and other post-employment benefit
obligations; increases in our warranty, product liability and
recall costs; the outcome of legal or regulatory proceedings to
which we are or may become a party; as well as those factors
identified in our filings with the SEC (including our Annual Report
on Form 10-K for the fiscal year ended Dec. 31, 2007). We assume no
obligation to update these forward-looking statements.
http://www.newscom.com/cgi-bin/prnh/20001201/DEF008LOGO
http://photoarchive.ap.org/ DATASOURCE: Visteon Corporation
CONTACT: Media, Julie Fream, +1-734-710-7250, , or Jonna
Christensen, 44-1268-701094, , or Investors, Derek Fiebig,
+1-734-710-5800, , all of Visteon Corporation Web site:
http://www.visteon.com/
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