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Johnson Controls Exploring Strategic Alternatives For Power Solutions Business

Johnson Controls expects to complete its assessment of strategic alternatives over the next several months. To assist the company in its review, Johnson Controls has retained Centerview Partners as financial advisers.

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Johnson Controls International plc (JCI) announced that it is exploring strategic alternatives for its Power Solutions business.

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Johnson Controls’ portfolio includes two leading platforms within their respective industries – an integrated buildings technology and solutions business and a power solutions business that is a global leader in battery solutions for the automotive sector, with an advantaged position in the aftermarket. JCI says both of these platforms are well-positioned but also are navigating markedly different industry landscapes with unique strategic, financial and operational opportunities and requirements.

“Creating shareholder value is our top priority. Our focus is on improving operational execution, realizing merger synergy and productivity benefits and optimizing the business portfolio. Given the differing dynamics of the platforms, we are evaluating strategic alternatives for Power Solutions,” said George Oliver, chairman and CEO. “Over the years our team has built Power Solutions into an incredible business with a high-margin aftermarket model that has delivered consistent growth through business cycles. These strong fundamentals, as well as recently issued provisions of U.S. tax reform, will be taken into account as we review the alternatives and assess which option creates the best long-term results for the business and the most value for shareholders.

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“Today’s announcement also reflects our strategic priority to strengthen and invest in our global market-leading positions in HVAC, fire and security solutions and integrated building management systems, which operate in attractive vertical markets with strong growth prospects,” Oliver added.

Johnson Controls Power Solutions works in partnership with its customers to meet increasing electrification requirements in vehicles. The company’s 15,000 Power Solutions employees create, manufacture, and distribute battery technologies for virtually every type of vehicle. These technologies deliver sustainable, next-generation performance.

In fiscal 2017, Power Solutions generated $7.3 billion in revenue and $1.6 billion in earnings before interest, taxes, depreciation and amortization (EBITDA).

Johnson Controls expects to complete its assessment of strategic alternatives over the next several months. To assist the company in its review, Johnson Controls has retained Centerview Partners as financial advisers.

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