Japan's Calsonic Kansei has agreed to buy Fiat Chrysler’s auto parts business Magneti Marelli for more than $7 billion.
Fiat Chrysler's CEO Mike Manley said that the automaker considered "a range of options" for Magneti Marelli before deciding to sell it to U.S. private equity firm KKR-owned automotive company Calsonic Kansei.
The deal between the two auto parts manufacturers is expected to rake in total annual revenues of €15.2 billion ($17.5 billion) and have nearly 200 facilities and research centers globally for the combined business, as suggested by Fiat Chrysler. The deal could close in the first half of 2019, subject to regulatory approvals.
The announcement comes amidst rapid evolution in the auto industry landscape, with electric cars and self-driving vehicles among major technologies at the forefront of the shift. Maybe, selling off its auto parts unit would allow Fiat to focus more on leveraging the new trends in the vehicles market.