Modine announces termination of securities and asset purchase agreement for liquid-cooled automotive business
RACINE, Wisconsin., 25 October 2021 / PRNewswire / – Modine Manufacturing Company (NYSE: MOD or the “Company”), a diversified global leader in thermal management technologies and solutions, today announced that the Company has entered into a mutual agreement with Dana Incorporated to terminate the purchase of Accord securities and assets for the liquid-cooled portion of the Company’s automotive business. Both companies had actively participated in the regulatory review process by Germany for many months and decided that it was no longer in the best interests of either party to continue with the transaction.
“Our team worked diligently to divest this part of our automotive business and we were unable to come to an agreement that would receive the necessary regulatory approval,” said Neil D. Brinker, President and CEO. “Over the past several months, we have foreseen this possibility and developed a robust plan. We stand ready to make significant changes to this business, especially in response to declining production volumes resulting from the global semiconductor shortage. was held for sale, we were prohibited from taking any action to substantially alter the business. Now that we have terminated the agreement, we can apply an 80/20 lens to this business and make the necessary changes to significantly reduce costs and improve operating margins. This includes focusing resources on products for which we have a sustainable competitive position and which support our profitability goals. We expect this new approach to be more financially beneficial for Modine and generate long-term value for our shareholders. ”
The Company plans to take measures to reduce costs and capital expenditures in areas where the Company does not have a competitive position. The ultimate goal is to optimize profit margins and cash flow while delivering greater added value to key customers.
Brinker concluded: “Over the past year we have taken important steps towards creating a stronger Modine. We are organizing our business to accelerate growth and have appointed experienced leaders to our business units. Our 80/20 initiative makes big decisions and begins to make tangible improvements across the business. Today’s announcement is in line with this overall strategy and we believe it will help accelerate Modine’s transformation. Our vehicular strategy is only one element in our history of transformation. We are also providing additional resources to develop other businesses that have strong market drivers, including electric vehicles, data centers, heating, indoor air quality, and coatings. Together, these initiatives will help Modine become a higher margin, higher growth, lower capitalization company. We are excited about the prospects for developing each of these core principles and generating long-term value for all of our stakeholders. ”
Modine, with 2021 tax revenues of $ 1.8 billion, specializes in thermal management systems and components, bringing high-tech heating and cooling components, original equipment products and systems to diverse global markets through its four complementary segments: BHVAC, CIS , HDE and automotive. Modine is a global company headquartered in Racine, Wisconsin (United States), with operations in North America, South America, Europe and Asia. For more information on Modine, visit www.modine.com.
Before the ward-Looking Statements
This press release contains statements, including information about future financial performance and market conditions, accompanied by phrases such as “believes”, “believes”, “expects”, “anticipates”, “anticipates” “,” Intends “and other similar” forecasts “. “Forward-looking aspects” as defined in the Private Securities Litigation Reform Act of 1995. Modine’s actual results, performance or achievements may differ materially from those expressed or implied in these statements due to certain risks and uncertainties, including , but not limited to those described under “Risk Factors” in Item 1A of Part I of the Company’s Annual Report on Form 10-K for the year ended March 31, 2021 and under Forward-looking statements in section 7 of part II of this same report and in the Company’s quarterly report on form 10-Q for the quarter ended June 30, 2021. Other risks and uncertainties include, but are not limited to, the following: the impact of the COVID-19 pandemic on the national and global economy, our business, our suppliers, our customers and our employees; the overall health and focus on lowering prices of Modine’s customers; our ability to successfully execute our strategic and operational plans; our ability to effectively and efficiently change our cost structure in response to increases or decreases in sales volume and to complete and benefit from restructuring activities; our ability to meet the financial covenants of our credit agreements and to effectively fund our global liquidity needs; operational inefficiencies due to program launches, unexpected volume increases, product transfers, and delays or inefficiencies resulting from restrictions imposed in response to the COVID-19 pandemic; economic, social and political conditions, changes and challenges in the markets where Modine operates and competes, including fluctuations in exchange rates, tariffs (and the potential impacts of the trade war resulting from tariffs or measures retaliatory), inflation, changes in interest rates or tightening credit markets, recession, restrictions associated with import and export and foreign ownership, public health crises , supplier constraints and general uncertainties regarding the impact of regulatory and / or policy changes, including those related to taxation and trade, the COVID-19 pandemic and other issues, which have been or may be implemented in the United States or abroad, and the lingering uncertainty about the impacts of “Brexit”; the impact on Modine of any significant increase in commodity prices, in particular aluminum, copper, steel and stainless steel (nickel) and other purchased components and associated costs, and our ability to adjust the prices of products in response to such increases; the nature and significant exposure of Modine to the automotive industry and the dependence of this industry on the health of the economy; Modine’s ability to recruit and retain talent in managerial, executive, operational and administrative functions; Modine’s ability to protect its proprietary information and intellectual property from theft or attacks; the impact of any material disruption or material breach of our information technology systems; costs and other effects of environmental investigations, remedies or litigation; and other risks and uncertainties identified by the Company in public documents filed with the United States Securities and Exchange Commission. Forward-looking statements are as of the date of this release, and the Company assumes no obligation to update any forward-looking statements.
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