LG Electronics Does Not Participate in Preliminary Bidding for Hanon Systems Sale

Leading Candidate Hanla Group Also Excluded
Competition Expected Among Foreign Companies

LG Twin Towers in Yeouido, Seoul
[Image source=Yonhap News]

[Asia Economy Reporter Kim Heung-soon] LG Electronics did not participate in the preliminary bidding for the sale of Hanon Systems, a company specializing in automotive thermal management systems. With a major domestic candidate dropping out, the acquisition battle is likely to narrow down to competition among foreign companies.

According to the financial investment industry and business circles on the 22nd, LG Electronics is understood not to have participated in the preliminary bidding to sell 70% of Hanon Systems' shares.

Previously, industry insiders expected LG Electronics to participate in the preliminary bidding, as it is strengthening its automotive electronics business by launching a joint venture with Canadian auto parts company Magna International next month.

Halla Group, another acquisition candidate mentioned alongside LG Electronics, also did not participate in this preliminary bidding. Halla Group had established 'Halla Climate Control,' the predecessor of Hanon Systems, in partnership with the U.S. company Ford.

Instead, foreign competitors such as France's Valeo and Germany's Mahle reportedly participated in the bidding. Private equity firms Carlyle and Bain Capital are also mentioned as candidates.

The sale targets include 50.50% stake held by Han & Co Auto Holdings LLC (private equity firm Han & Company) and 19.49% stake held by Hankook Tire & Technology. The value of the shares is approximately 6.9 trillion KRW based on Hanon Systems' closing price the previous day.

In 2015, Han & Company and Hankook Tire purchased a 70% stake held by Ford affiliate Visteon for about 3.94 trillion KRW. Hanon Systems is a company that produces and supplies automotive thermal management systems and is known to hold the world's second-largest market share in the industry.

This content was produced with the assistance of AI translation services.