Johnson Controls to Complete Strategic Review of Vehicle-Battery Business
The Wall Street Journal reports...
Company hires Centerview Partners to weigh options for its power solutions unit
Johnson Controls International JCI -1.10% PLC could sell or spin off its battery business as part of the industrial company’s plan to strengthen its core building technology offerings.
The Ireland-based company said Monday it is exploring strategic alternatives for its power solutions business, which brought in about $7.3 billion of revenue in the past fiscal year. The power solutions business primarily sells lead-acid batteries for trucks and cars but it also supplies batteries for hybrid and electric vehicles. The business employs about 15,000 people.
The majority of the company’s revenue comes from its building technologies segment, which brought in about $23 billion in the past fiscal year.
Johnson Controls said the two units are each well-positioned but navigating different industry landscapes. Chief Executive George Oliver said in prepared remarks that the company plans to invest in and strengthen its HVAC, fire and security solutions and integrated building management systems business.
The company said it has hired Centerview Partners as a financial adviser and expects to complete its review over the next several months. The company said the review may not result in a transaction.
The latest review comes a few months after Johnson Controls closed a deal to sell its Scott Safety business to 3M Co. for around $2 billion. The Scott Safety unit produced respiratory protection, gas and flame detection, thermal imaging and other products for fire and police departments and customers in industrial, oil and gas, chemical, military and homeland defense segments. Proceeds from the deal were used to pay down part of $4 billion in debt resulting from a merger with Tyco International.
Johnson Controls shares are down 6.5% over the past year.
as reported on wsj.com