General Cable Corp., Highland Heights, Ky., completed the sale of its North American automotive ignition wire business to Standard Motor Products, Inc. (SMP) for cash consideration of approximately $71 million, subject to customary post-closing adjustments. General Cable said proceeds of the sale will be used to reduce outstanding borrowings.
The deal includes General Cable’s automotive ignition wire business in North America as well as a subsidiary in Mexico.
“We are executing our new strategic roadmap, and a key component of the roadmap is focusing and optimizing our portfolio of businesses,” said Mike McDonnell, General Cable’s president and CEO. “While the automotive ignition wire business has been a strong performing business for us over the years, we determined through our strategic review that it is not aligned with our strategic and financial criteria going forward. As previously communicated, we are focused on growing our businesses in the electric utility, communications and industrial markets where we have leading positions, scale and sustainable profitability.”
In the mergers and acquisitions game, General Cable has primarily been a seller the past few years, divesting its business units in the Asia Pacific region last year, including operations in Thailand and joint ventures in Fiji and China and its interest in copper miner Phelps Dodge Philippines. The company announced the plan in 2014 to divest Asia Pacific and Africa to reduce complexity of the company’s operations. Along the way it has also replaced its CEO, with Michael McDonnell succeeding Greg Kenney in the lead role.