Autoliv Invests in Korea
Buys Remaining Shares in Joint Venture
(Stockholm, January 11, 2007) – – – Autoliv (NYSE: ALV and SSE: ALIV), the worldwide leader in automotive safety systems, has agreed to buy the remaining 35% of the shares in Autoliv-Mando in South Korea. The investment is part of Autoliv’s global support of the Korean automotive industry which is expected to double production to eight million passenger cars by 2010, with most of the growth outside Korea. The acquisition will enable Autoliv to fully integrate the Korean company into its global business operations.
Autoliv-Mando was founded in 2000 with Autoliv holding 65% of the shares. By 2006, sales had risen to exceed $230 million. This increase in sales has been mostly due to organic growth with minor help from the 2001 acquisition of Mando’s airbag business and transfer of business from Autoliv companies in other countries.
In 2007, the acquisition of the remaining shares is expected to increase Autoliv’s amortization by $12 million and interest expense by approximately $3 million. However, these negative effects will be fully offset by a reduction in Autoliv’s cost for minority interest in subsidiaries. As a result, the net effect of the acquisition is expected to be positive with an estimated increase in earnings per share of approximately 3 cents. The amortization will decrease gradually and cease after 2009.
The acquisition, which is subject to governmental approval, is expected to close in January 2007.
Lars Westerberg, President and CEO, Autoliv Inc., Phone +46-8-587 20 620
Gunnar Dahlén, President Autoliv Asia Pacific., Phone +66-2659-8510