July 30, 2018 / 6:10 AM / 19 days ago

UPDATE 1-Oerlikon sells drives business to Dana for around 600 mln Sfr

(Adds details and background)

ZURICH, July 30 (Reuters) - OC Oerlikon has agreed to sell its drives unit to U.S. engineering company Dana Inc , the Swiss company said on Monday after shelving a planned listing of the business.

Oerlikon said it had signed a definitive agreement to sell the business for an enterprise value of 600 million Swiss francs ($603.3 million) and expected to receive roughly the same amount of cash. The deal is expected to close by the first quarter of 2019 at the latest.

Oerlikon cited market volatility when cancelling the listing this month, adding to signs that the Swiss IPO market was cooling after a strong start this year.

The company's stock looked set to react positively, gaining 1.5 percent in premarket indications.

Oerlikon had planned to raise up to 620 million Swiss francs by floating the division, whose margins have lagged the group average.

Dana, which has $7.2 billion in annual sales, is buying a nearly century-old business that provides high-performance gears and other products for the agriculture, automotive, transport, construction and energy industries. In 2017 it generated 730 million francs in revenue and 78 million in EBITDA.

It makes transmissions for Lamborghini and Ferrari and other sports car makers.

Oerlikon will report the Drive Systems Segment under 'discontinued operations' as of the second quarter of 2018. It will provide preliminary restated 2017 results and updated guidance for the 2018 financial year with second-quarter results on Aug. 7. ($1 = 0.9946 Swiss francs) (Reporting by John Revill; Editing by Gopakumar Warrier)

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