Visteon CEO Stebbins Resigns; Leuliette Is Interim Chief
Visteon Corp. (VC), the auto-parts maker that’s been the subject of takeover speculation, climbed yesterday to the highest value in more than two months after Chief Executive Officer Don Stebbins’s departure fueled interest in a deal between the company and South Korea’s Mando Corp.
Visteon advanced 8.3 percent yesterday to $42.01 in New York, the highest closing price since May 29.
Stebbins, 54, who led Visteon out of bankruptcy in 2010, resigned on Aug. 10, the Van Buren Township, Michigan-based company said yesterday in a statement. The board appointed director Tim Leuliette, 62, to take over from Stebbins on an interim basis while it looks for a new CEO. A Deutsche Bank report last week said Visteon may be acquired by Mando. (060980)
The rise in Visteon’s shares is “less an indictment of Don and more a conclusion drawn by the markets and speculation of where things are going with regards to Mando,” Matthew Stover, a Boston-based analyst at Guggenheim Securities LLC, said in a telephone interview. “The market’s concluded that it’s raised the probability” of merger or acquisition activity, he said.
Visteon has been trying to shed units with lower margins such as interiors and lighting to focus on faster-growing operations in Asia. Mando, a maker of brakes and steering systems, said Aug. 7 that it reached a preliminary agreement to buy a stake in Halla Climate Control Corp. (018880), a company 70 percent owned by Visteon.
The purchase may mean that Visteon will either sell its holdings in Halla to Mando or be acquired by Mando, Deutsche Bank analysts wrote last week. Stover, the analyst at Guggenheim, declined to speculate on any specific potential transaction between Visteon and Halla.
Visteon’s attempt to buy the remaining 30 percent of Halla was blocked in July by the South Korea’s National Pension Service, which said this month it would prefer to sell its 8.1 percent stake to Mando. Visteon in July also ended an agreement to sell the majority of its interiors business to its joint venture with Huayu Automotive Systems Co. (600741)
After the two attempted deals fell apart, Stebbins said in an interview this month that he doesn’t expect any new transactions to close this year.
“The board understands the complexity and we understand that not getting this done isn’t meeting our objectives,” Stebbins said during the Aug. 2 interview. “You’d have to talk to them as to whether or not that impacts the decisions they may make on any members of the management team.”
Stebbins joined Visteon from Lear Corp. (LEA) in May 2005 as president and chief operating officer. He became CEO in June 2008 and also served as chairman since December of that year.
“Don led Visteon through a significant transformation during a challenging time for the automotive industry and the company,” Kevin Dowd, lead independent director, said in a statement. “We are fortunate to have someone of Tim’s caliber and experience to step in and lead Visteon on an interim basis.”
Leuliette served as CEO of Dura Automotive until 2010, the year he became a Visteon director.
Visteon’s board also appointed Francis Scricco and David Treadwell as directors, increasing its membership to eight from seven. Visteon was spun off from Ford Motor Co. (F) in 2000.
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