Hitachi : Faurecia to buy Hitachi car navigation unit Clarion in $710 million deal - Nikkei
October 25, 2018 at 01:55 pm IST
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TOKYO (Reuters) - French car parts maker Faurecia is set to buy a majority stake in Japanese car navigation system maker Clarion Co from Hitachi Ltd for around 80 billion yen ($710 million), the Nikkei reported on Thursday.
The report said Hitachi agreed to sell most of its stake to Faurecia, making the French company a majority owner. Hitachi, which owned around 63.6 percent of Clarion shares as of end-March, said it was considering various options but had not made any decision.
The report comes amid a flurry of deals among car components makers, which are trying to keep up with a shift by car makers into new technologies such as autonomous driving, connected cars and electric vehicles.
It also follows several divestitures by Hitachi, which has been shedding non-core operations in recent years to bolster its profitability and focus on its main infrastructure business.
The car navigation business has struggled as more drivers have turned to their smartphones for street directions, prompting Clarion to try expanding into new areas such as autonomous parking.
Clarion, which reported its latest business results on Thursday, said its operating profit for the 6 months through September fell to 1.6 billion yen, down 56 percent from a year earlier.
($1 = 112.1600 yen)
(Reporting by Ritsuko Ando; Editing by Chang-Ran Kim, Amrutha Gayathri)
Hitachi specializes in manufacturing and marketing of electronic and industrial equipments. Net sales (including intragroup) break down by family of products and services as follows:
- social infrastructure and industrial systems (24.7%): elevators, escalators, industrial facilities, railway systems, power generation units, etc. The group also provides engineering and construction of nuclear, hydroelectric, and thermal power plants services;
- information and telecommunications products and services (20.1%): systems integration, cloud computing, software, servers, hard disks, PCs, ATMs, data communication base stations, payment terminals, etc.;
- materials and components (16.6%): semi-conductor materials, printed circuit cards, cables, copper and forged steel products, magnetic materials, organic and inorganic chemical products, etc.;
- construction equipment (10%) : hydraulic excavators, wheel loaders, mining equipment, etc.;
- automotive systems (9.4%): powertrain systems, control systems, etc.;
- electronic products (9.2%): fiber-optic components, screen tubes, testing and measurement equipment, medical equipment, equipment for manufacturing semiconductors, etc.;
- household appliances (4.7%): heating and air conditioning equipments, refrigerators, washing machines, etc.;
- other (5.3%): mainly transport, financial and logistical services.
Net sales are distributed geographically as follows: Japan (49.2%), Asia (21.3%), North America (12.7%), Europe (10.8%) and other (6%).