Gillingham, England: Delphi Automotive has announced it will execute a tax-free spin-off of its Powertrain Systems segment into a new, independent publicly traded company.
The split and sale of the company is expected to be completed by March 2018 and following immediately, its shareholders will own shares of both companies.
Delphi Powertrain will focus on optimising vehicle propulsion systems by improving environmental efficiency and vehicle performance. The company will supply to original equipment manufacturers and aftermarket customers; its revenue was approximately US$4.5 billion in 2016.
The convergence of technologies underpinning industry megatrends is driving demand for advanced electronics and increased computing power to meet consumer preferences for improved safety, efficiency, and connectivity. Moreover, regulations for emissions and fuel economy are becoming increasingly stringent worldwide. This requires advanced engine management and electrification systems to enhance vehicle performance and meet customer demand.
“Looking ahead, new mobility will be defined by the convergence of automated driving, increased electrification, and connected infotainment, all enabled by exponential increases in computing power and smart vehicle architectures,” said Kevin Clark, president and chief executive officer.
Upon completion of the transaction, the electrical/electronic architecture as well as the electronics safety divisions will remain the core of the company, providing signal and power distribution products, centralised computing platforms, advanced safety and autonomous driving systems, enhanced infotainment and user experience, vehicle connectivity and electrification, and data services.
Timothy Manganello, currently an independent director on the Delphi board, will become non-executive chairman of the new Powertrain company’s board of directors upon the separation. He is currently senior vice president and president of Powertrain Systems, and he will become president and chief executive officer of the new operation.