(Adds Visteon declining comment)
Sept 10 (Reuters) - Auto-parts maker Visteon Corp is exploring a plan to split into two companies focused on electronics and climate controls, Bloomberg reported, citing people familiar with the matter.
Visteon, once a part of Ford Motor Co may consider selling or spinning off the electronics business, the report said. (bloom.bg/1xISQ6w)
The company’s shares rose as much as 6.2 percent to $109.41 on the New York Stock Exchange on Wednesday.
Visteon’s board has concluded that the two divisions have little overlap in their operations and add little value under one corporate umbrella, the report said.
A Visteon spokesperson declined to comment on the report.
The electronics business, which makes audio and infotainment products, amplifiers and rear-seat family entertainment systems, contributed about 20 percent to the company’s annual revenue of $7.44 billion in 2013.
In July, Visteon completed the acquisition of JCI, the automotive electronics business of Johnson Controls, which makes products including automotive head-up display that shows information and directions on a windshield.
With this integration, Visteon’s electronics business is expected to grow at a rate of 153 percent to $3.8 billion by 2017, faster than the larger climate controls business, the company said during its second-quarter conference call.
The climate controls business makes heating and airconditioning systems for vehicles and contributed about 64 percent of company’s revenue in 2013.
Valued separately, the two businesses could be worth as much as $129 per share by 2016, Bloomberg said.
In May, Visteon signed an agreement to sell its automotive interiors business to private equity firm Cerberus Capital Management LP. The interiors business contributed about $1 billion to the company’s 2013 sales.
The company is yet to finalize advisors to help with the split. Any restructuring is unlikely to be finished by the end of this calendar year, the report said.
Up to Tuesday’s close The company’s stock had gained about 44 percent in the past year, outstripping the 10 percent rise in the Dow Jones U.S. Automobiles & Parts index. (Reporting by Ankit Ajmera in Bangalore; Editing by Maju Samuel)