Nissan Motor seeks sale of trading unit in $1 billion deal

Bloomberg

Nissan Motor Co is seeking to sell a wholly owned subsidiary that distributes vehicle parts and materials in a deal that may be valued at about $1 billion, as the struggling Japanese automaker seeks to slim down, people familiar with the matter said.
The company has invited private equity and trading firms to bid for 100 percent of Nissan Trading Co, according to the people, who asked not to be identified because the information isn’t public. The buyer may be selected by as early as October, according to the people. The target valuation includes assumed debt, they said.
A sale of the unit, which generated revenue of $6 billion in the fiscal year ended in March, would help Nissan free up cash to help turn around its broader business that’s been hurt by slumping US sales, aging vehicle models and an out-of-sync product cycle.
The automaker stepped up restructuring measures in July, which also included 12,500 job cuts, after its operating profit hit a decade low.
The sale process is ongoing, and no agreements have been reached, the people said. Koji Okuda, a spokesman for Yokohama-based Nissan, said he couldn’t immediately comment.
Hiroto Saikawa stepped down as Nissan’s chief executive officer after the board asked him to resign, with Chief Operating Officer Yasuhiro Yamauchi taking over until a permanent replacement is appointed by the end of October.
The restructuring measures and management shuffle is part of the turmoil unleashed following the arrest of former Chairman Carlos Ghosn in November for alleged financial crimes. He has denied all charges and is awaiting trial next year.
Nissan Trading, established in 1978, does business in South Korea, Mexico, India, the UK, China and the US, with 37 percent of revenue coming from vehicle components and 47 percent from materials.
Nissan shares pared a 1.1 percent decline to close at 713.9 yen in Tokyo, down 0.4 percent.