Magna said to be in negotiations to sell automotive interiors unit
Magna International Inc., North America’s biggest auto- parts maker, is in talks to sell its car- interior business to Spain’s Grupo Antolin, people familiar with the matter said.
An agreement may be reached as early as April, though talks could still be delayed or fall apart, said the people, who asked not to be identified because negotiations are private. Antolin may buy all or part of the business, which generates about $ 3 billion in annual sales and could attract interest from other buyers, the people said.
Magna shares in New York rose as much as six per cent, the most since Feb. 25, and were trading 1.6 per cent higher to close at $ 52.94.
Representatives for Antolin and Magna declined to comment.
The car- parts industry is under increasing pressure to consolidate as automakers look to work with partners that can produce more complex bundles of components to save costs. That requires suppliers with a range of offerings and broad geographical presence as automakers expand with new factories in markets like China, Mexico and Brazil.
For closely held Grupo Antolin, the deal would bolster chairman Ernesto Antolin’s goal of becoming the world’s largest supplier of auto interiors, while Magna could free up resources for its operations in elec- tronics, powertrain and batteries.
Antolin, which is based in Burgos, Spain, manufactures car- roof interior systems, doors, seats and lighting components and had sales of 2.73 billion euros ($ 2.96 billion) in 2013 and 14,800 employees in 25 countries, according to its website. Antolin provides parts for one in every four cars manufactured worldwide, the company says.
Magna’s interiors unit supplies components including cockpit systems and door panels to global automakers ranging from Toyota Motor Corp. to Tesla Motors Inc., according to its website. The Aurora, Ontario- based company in February reported fourth- quarter adjusted earnings before interest and taxes of $ 712 million, and increased its dividend.