Visteon rejects takeover bid

US-based automotive tier one Visteon Corp. announced that it has rejected an unsolicited proposal from Johnson Controls (JCI) to purchase certain assets associated with Visteon's interiors and electronics businesses. Visteon conveyed the reasons for its decision, taken after thorough analysis, in a letter to JCI.

In its letter, Visteon says its board of directors believes that the company has better chances to continue its earlier reorganization plan to emerge from bankruptcy as an independent company.

“Our careful analysis demonstrates that your acquisition of selected assets, while excluding certain liabilities, would accelerate other costs and would not significantly enhance recoveries to our creditors or provide recovery for our equity holders”, Visteon wrote. Also, according to Visteon's assessment, the takeover would extend the time Visteon to remain in bankruptcy.

In addition, Visteon expressed concerns that JCI's “recent contacts with our customers and aggressive characterizations” of its proposal could “potentially damage our business and relationships with key customers.” In this context, Visteon demanded JCI’s management to end these communications.

Since JCI made its takeover bid public, Visteon also published its letter declining this offer.

Courtesy of Automotive DesignLine Europe.