Visteon Corporation (VC)

[jay1000]

Visteon CEO hints at breakup but mum on details 07/27 03:05 PM

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* Same 4 business lines unlikely in 3 years' time -CEO

* Not "value-enhancing" to pre-announce sale plans -CEO

By Clare Baldwin

DETROIT, July 27 (Reuters) - The chief executive officer of auto parts supplier Visteon Corp (VC:$65.4500,$-2.3700,-3.49%) hinted at plans to break up the company on Wednesday, but declined to give details, saying disclosure would hurt any potential deal.

"As we look out over a three-year horizon ... I would be surprised if the product portfolio is the same as it is today," CEO Don Stebbins said during the question and answer period of the company's investor day.

He later added that the time to announce a business is for sale is once it's sold. "I don't think it's a value-enhancing proposition to announce today that X, Y, Z business is going to be sold," he said in response to a question about what businesses Visteon (VC:$65.4500,$-2.3700,-3.49%) wants to stay in and when it wants to be out of others.

Investors, including hedge fund Alden Global Capital, have called for a breakup, arguing that the company is more valuable in parts than as a whole. [ID:nN1E7670GX]

Any direct statements about a potential sale would disrupt customer relationships and would create difficulties for both the seller and the buyer, Stebbins said.

"Customers will also enter into the fray as to who they think should be the ultimate buyer," he said. "I think it creates a significant difficulty in terms of valuation."

Visteon (VC:$65.4500,$-2.3700,-3.49%) has interiors, climate control, electronics and lighting units businesses. Management has said previously that it would be costly and complicated to disentangle them.

Based in Van Buren Township, Michigan, Visteon (VC:$65.4500,$-2.3700,-3.49%) is one of nearly 50 U.S. auto parts suppliers that went bankrupt during the financial crisis.

The former Ford Motor Co subsidiary emerged from bankruptcy with hedge funds and other short-term investors as owners. It avoided a proxy fight with Alden in May by agreeing to give the hedge fund two board seats.

Visteon (VC:$65.4500,$-2.3700,-3.49%) shares were down 3.4 percent at $65.51 in afternoon trading on the New York Stock Exchange. (Reporting by Clare Baldwin; Editing by Gary Hill)


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