Detroit Bureau on Twitter

Posts Tagged ‘Visteon’

Johnson Controls Still Pursuing Visteon

Former Ford Motor parts maker rejects JCI proposal. Ford claims neutrality; likely working behind scenes to protect itself.

by on Jun.07, 2010

Johnson loses nothing by buying the parts operations or delaying Visteon's eventual bankruptcy emergence.

Johnson Controls (NYSE: JCI) has confirmed that it sent Visteon Corporation (OTC: VSTNQ) a letter late last week that said it remains interested in pursuing its rejected proposal to buy some of the bankrupt company’s assets. It gave no further details on how it would enhance the $1.25 billion cash bid for Visteon’s electronic and interior businesses, leaving the climate control operation behind.

The businesses JCI wants generated more than $4 billion in sales during 2009, the worst automotive market in decades. In 2009, Visteon had product sales of $6.42 billion – down $2.7 billion from the prior year. There clearly is upside potential for the eventual owner.

The latest development complicates what is already a long running bankruptcy that was filed under Chapter 11 in May of 2009. Shareholders and bondholders are currently vying to see who will control the plan that will let Visteon emerge from receivership. At stake is ownership of the assets, including the ones that JCI wants to buy – or steal, depending on your point of view.

It also could be a business tactic since Johnson Controls is a direct competitor that stands to benefit by introducing delay or complexity into the Visteon reorganization process.

Visteon, the former Ford Motor Company parts maker, has used bankruptcy to improve its balance sheet, and its first-quarter profit rose to $233 million from $2 million a year earlier. The businesses in question are largely based in China, now the world’s largest auto market.

A Ford spokesperson declined to comment specifically on the JCI Visteon issue.

“JCI is a strong company and one of our long-term suppliers. At the same time, Visteon and Ford have a long business relationship. We have been, and remain, supportive of Visteon as it works through its bankruptcy restructuring process,” the spokesperson said.

“Whatever happens, Ford is going to want to make sure that Visteon remains viable, and at some point will make its views known to the court,” said Joe Phillippi of the AutoTrends consultancy.

(more…)

Visteon Goes Bust

This time, it couldn’t escape a Chapter 11 filing.

by on May.28, 2009

Ford's former partsmaking operations, Visteon Corp., had repeatedly dodged the hangman's noose, but it's finally facing Chapter 11 reorganization.

Ford's former partsmaking operations, Visteon Corp., had repeatedly dodged the hangman's noose, but it's finally facing Chapter 11 reorganization.

After a series of narrow, 11th hour escapes, the clock finally struck for long-troubled auto supplier Visteon Corp., this morning, the company announcing it is filing for Chapter 11 bankruptcy protection.

The one-time Ford partsmaking operation has been in trouble almost since its birth, in late 2000, and has depended on a series of handouts and concessions from its former parent to avoid a financial collapse up until this point.  Indeed, it was only through meeting a last-minute deadline to cover interest on its vast debt, barely a month ago, that Visteon was able to remain solvent.

But the company says that the current, deep automotive sales slump, compounded by planned summer production shutdowns, simply made it impossible to keep going without a court-protected reorganization.

Subscribe to TheDetroitBureau.com“During the reorganization period, we will seek to address our capital structure and legacy costs that are not sustainable given the current economic environment,” said Visteon Chairman and CEO Donald J. Stebbins, in a prepared statement. (more…)

Visteon may become next big casualty of slump

Supplier declares bankruptcy in Britain; U.S. could follow.

by on Apr.01, 2009

Ford's former partsmaking operations, Visteon Corp., has so far avoided Chapter 11 in the U.S., but its key British subsidiary is now in bankruptcy.

Ford's former partsmaking operations, Visteon Corp., has so far avoided Chapter 11 in the U.S., but its key British subsidiary is now in bankruptcy.

Is one of the Ford Motors Co.’s most critical suppliers, Visteon Corp, the next big victim of the automotive slump?  The partsmaker recently sidestepped a crisis with a last-minute payment on debt, in the U.S.  But Visteon officials may not be able to keep pulling rabbits out of their hat much longer, as the bankruptcy of a key British subsidiary strongly suggests.

The company has had to appeal to its creditors for temporary waivers and amendments to its primary secured credit facilities to continue to operate.  The amendments buy the company some time while it continues to address its capital structure, engaging in “discussions with customers to address its liquidity and capital requirements,” Visteon said in statement released after the stock closed, on Tuesday, suggesting the situation has turned grave.

(more…)