Autoliv, Inc. (NYSE: ALV and SSE: ALIVsdb), the worldwide leader in automotive safety systems, on March 31, 2016 finalized its joint venture with Nissin Kogyo (TSE: 7230.T) to form Autoliv-Nissin Brake Systems (ANBS). The joint venture is an important milestone in Autoliv’s strategy to be the leader in safety systems for the future car, well integrated with autonomous driving.
ANBS combines the current brake control business of Autoliv with a “carve-out” of Nissin Kogyo’s automotive braking business. ANBS joins Nissin Kogyo’s world leading expertise and technology in brake control and actuation systems with Autoliv’s global reach and customer base to create a global competitive offering competing in the growing global brake control systems market. The joint venture will also further strengthen Autoliv’s role as a leading system supplier for autonomous vehicles.
ANBS will be part of Autoliv’s Electronics business segment (consisting of passive safety electronics products, ADAS products and brake control systems). Autoliv owns 51% of the joint venture and has management and operational control. Autoliv will consolidate 100% of ANBS in its financial statements. Nissin Kogyo’s 49% share of the joint venture’s net income will be treated as a minority interest.
“Today is an important day for Autoliv. The formation of Autoliv-Nissin Brake Systems will allow us to offer state of the art brake control and actuation systems to auto manufacturers around the world. It will further enhance our role as the leading safety system supplier for the future car, well integrated with autonomous driving,” said Autoliv Chairman, President & CEO Jan Carlson.
Autoliv purchased 51% of the joint venture for JPY 29.7 billion (approximately USD 264 million, using March 31stexchange rates), including pre-closing adjustments and subject to customary post-closing adjustments. ANBS sales and operating margin for the nine month period April-December 2016 is expected to be slightly lower than initially communicated, sales are now expected to be in the range of USD 400-450 million for the same nine month period.
Beginning with the second quarter 2016 earnings release Autoliv plans to disclose information about ANBS in line with the other units (ADAS products and passive safety electronics products) in the Electronics business segment.
