August 5, 2019 / 12:23 PM / 12 days ago

Textron exploring options for fuel tanks unit

(Reuters) - Cessna business jets maker Textron Inc (TXT.N) said on Monday it will explore options for its unit that manufactures fuel tanks for vehicles, including a sale or a spinoff, as it focuses on its higher margin businesses.

The company’s shares rose 3.13% to $48.50 before the bell.

The unit, Kautex, is part of Textron’s industrial business, which reported a profit margin of 6.6% in the first six months of 2019, the lowest among the company’s four units.

Textron’s total profit margin was about 10% for the same period.

Bonn, Germany-based Kautex makes pressurized fuel tanks for cars, light trucks and all-terrain vehicles, and reported more than $2.3 billion in revenue in 2018.

Kautex also makes selective catalytic reduction systems used to reduce emissions from diesel engines.

Goldman Sachs & Co LLC is Textron’s financial adviser for the review.

Reporting by Ankit Ajmera and Sanjana Shivdas in Bengaluru; Editing by Sriraj Kalluvila

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