BorgWarner to spin-off fuel systems, aftermarket units as it sharpens EV focus
Dec 6 (Reuters) - BorgWarner Inc said on Tuesday it plans to spin-off its fuel systems and aftermarket segments into a separate company, in a bid to sharpen its focus on becoming an electric vehicle (EV) supplier.
Shares of BorgWarner, which supplies to car makers including General Motors Co (GM.N) and Ford Motor Co (F.N), were up 3.8% at $43.50 before the bell.
"The intended separation of our Fuel Systems and Aftermarket segments would be an important next step to further our pivot to EVs," said BorgWarner Chief Executive Frédéric Lissalde.
The Michigan-based company believes it would "ultimately achieve or exceed" its stated target of 25% of revenue from EVs by 2025 as automakers invest billions of dollars to develop environment-friendly vehicles.
After the spin-off is complete, BorgWarner would consist of the e-propulsion & drivetrain and air management segments. The "NewCo", comprising fuel systems and aftermarket segments, will be publicly traded.
In the first nine months of 2022, BorgWarner's air management segment's revenue was $5.5 billion, while its e-propulsion and drivetrain unit generated about $3.9 billion.
The fuel systems business had revenue of about $1.7 billion while the aftermarket unit generated just under $1.0 billion in sales.
Our Standards: The Thomson Reuters Trust Principles.