Johnson Electric to increase ownership interest in Halla Stackpole Corporation

March 22, 2017

Johnson Electric Holdings Limited, Hong Kong, China, has announced a definitive agreement to acquire an additional 50% equity interest in Halla Stackpole Corporation (HSC), Ochang, South Korea for 93.9 billion Korean Won ($83.8 million). Established in 2008, HSC is a joint venture between Halla Holdings Corporation, Korea, and Stackpole International, Canada.

Since the acquisition of Stackpole International by Johnson Electric in October 2015, HSC has been a 30% owned affiliate of the Johnson Electric Group. Upon completion of the acquisition of an additional 50% equity interest from Halla Holdings, Johnson Electric’s ownership interest in HSC will increase to 80%.

HSC supplies Powder Metallurgy components to the Asian automotive industry. The company reported consolidated revenues for the year ended December 31, 2016, of 158 billion Korean Won (approximately US$141 million). The business operates two production facilities – one in Korea and one in China – and employs over 500 people.

“This is an attractive opportunity to increase the group’s exposure to the rapidly growing powder metal market in Asia. Stackpole International is already a recognised market leader in the powder metal industry in North America and this complementary investment provides a platform for accelerating sales growth and strengthening the Johnson Electric Group’s position as a global supplier to key engine, transmission, suspension and steering applications,” stated Dr Patrick Wang, Chairman and Chief Executive of Johnson Electric.

Johnson Electric will increase its ownership interest in an all-cash transaction, financed from a combination of its current cash balances and proceeds from existing revolving credit facilities. The transaction is expected to close in Q2 2017, subject to customary conditions including obtaining applicable regulatory approvals.

www.johnsonelectric.com

www.halla.com

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