From M2 Communications

VAN BUREN TOWNSHIP, MI -- Visteon Corp. yesterday announced a three-year, $800 million restructuring plan as part of a larger agreement reached in Sept. 2005 with its former parent Ford Motor Co. The duo reportedly hope to avoid the pitfalls that ensnared rivals General Motors and its chief auto parts supplier, Delphi. In an earlier agreement with Ford, Visteon will reportedly take a $250 million charge with some charges expected to appear on the books as early as the fourth quarter of 2005.

Ford reportedly set up a $400 million escrow account to reimburse Visteon for a portion of its restructuring charges. The auto parts company plans to sell off six plants and repair five, but the other 12 facilities owned by the company are reportedly being held in limbo until the company narrows the focus of its long-term restructuring. It was unclear yesterday how many employees would be affected by the move, but the company said it expects the restructuring costs to stem from severance and benefit packages, contract terminations, impairment costs, and the transfer of production among its remaining facilities, according to published reports.

Visteon shares fell 15 cents to $6.67 in trading on Wednesday. Ford shares gained 16 cents to $8.93 despite further cuts to Ford's bond rating by Moody's on Wednesday.

Copyright 2006 From M2 Communications. All Rights Reserved.

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