Faurecia Sells Auto-Exteriors Arm to Plastic Omnium
As part of the sale, Plastic Omnium will divest itself of its plastic-bumper-manufacturing business in France and its front-end-module operations in Germany, as well as one of its seven plants in Spain.
MADRID – The European Commission moves to break up a potential auto-parts monopoly by authorizing Plastic Omnium to pay French rival Faurecia €665 million ($743 million) for its automotive-exteriors business.
The sale is contingent on Plastic Omnium divesting itself of its plastic-bumper-manufacturing business in France and its front-end-module operations in Germany, as well as one of its seven plants in Spain. Plastic Omnium has not confirmed whether that facility is in Valencia, where both parts makers have factories.
The sale does not include Faurecia’s Hambach, France, plant that supplies Daimler-owned Smart and two joint ventures in Brazil and China.
Faurecia’s exterior-components operation employs 7,700 people at 22 sites globally and generated €2 billion ($2.2 billion) in sales in 2014. The company says the sale almost completely will eliminate its debt, allowing it to accelerate investment in advanced technologies.
Plastic Omnium with 32,000 employees, 136 plants and 22 R&D centers worldwide, says it expects the purchase to result in sales of €7.5 billion ($8.4 billion) in 2016.
“Plastic Omnium offered to divest key production facilities to address our concerns,” Margrethe Vestager, head of competition policy for the EC, says in a statement. “This ensures that car manufacturers in Europe will continue to have a choice of suppliers for automotive parts, such as bumpers, at competitive prices after the takeover.”
The EC, the executive branch of the European Union, reviewed the transaction out of concerns it might have led to price increases for plastic bumpers and other car components. “The commitments offered by the companies address these concerns,” the statement says.