By Amanda Zheng From Gasgoo.com, November 30, 2010
Shanghai November 30 (Gasgoo.com) U.S. Time November 29, 2010, Beijing Pacific Century Automotive Systems Co., Ltd. ("Pacific Century") announced in Detroit that it has officially acquired auto parts supplier Nexteer Automotive from General Motors Co. for $420 million, the largest Chinese investment in the global auto supplier industry ever, Chinanews.com reported Tuesday.
The deal, effective November 30, includes the Nexteer's steering and halfshaft operations, 22 manufacturing plants, six engineering sites and 14 customer support centers in North and South America, Europe and Asia.
Nexteer, which became a wholly owned subsidiary of GM last year when Delphi Corp. emerged from Chapter 11 bankruptcy, supplies steering and driveline components to a variety of manufacturers, including GM, Ford, Chrysler, Volkswagen, Toyota, etc..
As the world's most advanced automotive steering and transmission technologies company, Nexteer employs more than 8,000 people and does business with more than 60 auto manufacturers. Nexteer had $2.1 billion in revenue in 2008, and has been profitable in the past two years.
In order to focus attention on developing its core business, GM has sought to sell Nexteer to Pacific Century, formed by Tempo Group and an affiliate of the Beijing government, since January this year, and has signed the acquisition agreement with the Chinese parts supplier in July.
Nexteer is now the fourth-largest steering-parts supplier by market share, and its revenue this year will be about $2 billion, Chief Executive Officer Bob Remenar said. In regard to selling the unit, he said Pacific Century will bring more business opportunities to Nexteer and will certainly create more job opportunities as well.
Saginaw, Michigan City will remain Nexteer's worldwide headquarters. Besides, Nexteer will continue its five-year labor contract with United Auto Workers (UAW). Nexteer President Robert Remenar will continue to lead the company, along with his executive staff.