New joint venture, set up by International Automotive Components and Shanghai Shenda, will make floor carpets, acoustic insulators, package trays, trunk trim and utility flooring products for supply to OEMs worldwide.
19 Jan 2017 | 7358 Views | By Autocar Pro News Desk
International Automotive Components (IAC) and Shanghai Shenda Co Ltd today announced the signing of a definitive agreement to form a global joint venture (JV) partnership to supply soft trim and acoustics products to automotive original equipment manufacturers (OEMs).
A UK affiliate of Shenda will acquire a 70 percent stake ...
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International Automotive Components (IAC) and Shanghai Shenda Co Ltd today announced the signing of a definitive agreement to form a global joint venture (JV) partnership to supply soft trim and acoustics products to automotive original equipment manufacturers (OEMs).
A UK affiliate of Shenda will acquire a 70 percent stake in the UK-based JV based at an enterprise value of US$ 570 million while IAC, a leading global supplier of automotive components and systems, including interior and exterior trim, will maintain a 30 percent stake. The JV, which will be named at a later date, expands an existing, successful JV partnership between affiliates of IAC and Shenda, which is one of China’s largest automotive interior suppliers, spanning nearly two decades.
Similar to IAC and Shenda’s existing JV, the new JV’s management team will be comprised of experienced leaders from IAC. Its operations will include substantially all of IAC’s soft trim and acoustics operations, consisting of 21 manufacturing facilities and 4 technical centres worldwide. The JV is expected to generate more than US$ 1 billion in annual sales from floor carpets, acoustic insulators, package trays, trunk trim and utility flooring products.
“This new JV will transition Shenda from a regional Chinese soft trim and acoustics products manufacturer to a global supplier to the automotive industry,” said Yao Ming Hua, chairman of Shanghai Shenda Co. Ltd. “It will provide access to European and North American markets, complementing our current strong footprint in China.”
As a key action in IAC’s long-term business strategy, called 2020 Vision, the proceeds from the formation of the JV will allow IAC to continue investing globally in its core Cockpit & Overhead Systems business. “The resulting investment will make IAC a stronger global Tier One supplier in the interiors space,” said IAC president and CEO Robert (‘Steve’) Miller. “It also demonstrates that IAC’s principal owners, funds managed by WL Ross & Co. LLC and Franklin Mutual Advisers LLC, remain fully committed to the future of IAC.”