Livonia, Michigan –Tower International Inc. may be heading back to being Tower Automotive. The Tier 1 supplier of structural metal components and assemblies has announced plans to consider the sale of its European division.
“The time is right to evaluate whether the sale of Tower Europe could provide significant additional value for shareholders, as well as benefitting customers and colleagues by strengthening the remaining businesses in Europe and North America,” says President and CEO Mark Malcolm.
Malcolm says getting rid of the European division could help the company’s stock price as Tower trades at a lower multiple to its earnings than competitors who only work in North America. He adds that the sale could improve the company’s balance sheet, provide more flexibility to invest its profits, and highlight the growth of its North American business to investors.
Revenue for Tower Europe is projected at approximately $650 million for full year 2015. Tower Europe is headquartered in Germany, and has a good manufacturing footprint, with factories in Germany, Slovakia, Poland, Czech Republic, Italy, and Belgium. Malcolm believes its European operations have competitive cost, quality, and technology. The top ten vehicle platforms in terms of revenue include a good cross-section of customer brands, including Porsche, Mercedes, Volvo, VW, Fiat, BMW, and Skoda.
Company officials expect to decide whether or not to sell the division by the end of March, 2016.
Source: Tower International