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TOKYO – A manufacturer of auto parts owned by US acquisition company KKR & Co. has announced the acquisition of Magneti Marelli arm of Fiat Chrysler Automobiles NV for 6.2 billion euros (6, $ 1 billion). high ranking global automotive suppliers.
The Italian group Calsonic Kansei, of KKR, based in Japan, and the Italian Magneti Marelli will create a company generating an annual turnover of 15.2 billion euros. This could help increase the chances of survival in an auto parts industry increasingly dominated by giants such as Robert Bosch GmbH, Denso Corp. and Magna International Inc.
These larger companies are better able to spend research funds on next-generation technologies, such as autonomous vehicles and Internet-connected vehicles. Bosch achieved a turnover of 78.1 billion euros in 2017 and spent 7.2 billion euros in research and development.
The new company will also have a larger customer base after the transaction. Calsonic Kansei derives most of its business from Nissan Motor Co., with which it has a long history. Magneti Marelli is a subsidiary of Fiat Chrysler and relies on the group for about a third of its business, according to Fiat Chrysler's latest annual report.
KKR announced its acquisition of Calsonic Kansei in 2016 and finalized it next year. The Japanese company manufactures heating and cooling systems and components for Nissan's electric vehicles. Magneti Marelli manufactures, among others, headlights and electronic components.
In August, the Wall Street Journal announced that KKR was negotiating to acquire Magneti Marelli, citing people close to the issue.
Fiat Chrysler's new general manager, Mike Manley, who succeeded Sergio Marchionne, inherited Marchionne's efforts to boost the automaker's profitability.
Beda Bolzenius, CEO of Calsonic Kansei, will lead the new company, which will be called Magneti Marelli CK Holdings. Ermanno Ferrari, CEO of Magneti Marelli, will join the board of the new company.
Write to Sean McLain at [email protected]
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