Delphi Automotive PLC plans to spin off its powertrain systems segment into a new publicly traded company as it aims to grow its businesses, better serve its customers and unlock shareholder value.
The move, announced Wednesday, is intended to accelerate Delphi’s growth in products related to autonomous vehicles, data, infotainment and connectivity — the latest step in its transformation to a company offering “safe, clean and connected” technology to the global auto industry.
The automotive supplier, based in the United Kingdom but with a significant North American presence in Michigan, said the tax-free transaction is expected to be completed by March 2018, after which Delphi shareholders would own shares in both companies. The existing company will focus on advanced connectivity, autonomy and mobility.
“Today’s announcement represents an exciting opportunity for our businesses by creating two independent companies, each with a distinct product focus, a proven business model, and the flexibility to pursue accelerated investments in advanced technologies that solve our customers’ most complex challenges,” Delphi CEO Kevin Clark said in a statement.
“At a time of unprecedented industry change, the underlying strength of both our operating businesses and strategic partnerships will allow each company to focus even more sharply on its unique opportunities, continue to develop the very best advanced technologies, and help our customers navigate the road ahead.”
