- people on the move
Auto supplier merges and moves HQ to Ireland
A global auto supplier with a large presence in West Michigan and the state has entered into a definitive merger agreement with a company based in Ireland.
Johnson Controls said today that it will merge with Cork, Ireland-based Tyco, a maker of fire protection and security products, to create the “leader in building products and technology, integrated solutions and energy storage.”
Johnson Controls operates three primary divisions: Automotive Experience, or seating and interior; Power Solutions, including alternative automotive batteries; and Building Efficiency.
Upon the closing of the transaction, the combined company is expected to maintain Tyco's legal domicile in Ireland and global headquarters in Cork, Ireland.
The primary operational headquarters in North America for the combined company will be in Glendale, Wisconsin, outside of Milwaukee, where Johnson Controls has been based.
The businesses of Johnson Controls and Tyco will be combined under Tyco International plc, which will be re-named Johnson Controls plc.
The companies expect that shares of the combined company will be listed on the New York Stock Exchange and trade under the JCI ticker.
Under the terms of the agreement, which has been unanimously approved by both companies' boards of directors, Johnson Controls shareholders will own about 56 percent of the equity of the combined company and receive aggregate cash consideration of about $3.9 billion.
Current Tyco shareholders will own about 44 percent of the equity of the combined company.
The combination of the building-related businesses at Tyco and Johnson Controls creates "immediate opportunities for near-term growth through cross-selling, complementary branch and channel networks and expanded global reach for established businesses."
Alex Molinaroli, chairman and CEO of Johnson Controls, said the merger represents the next phase in the company’s transformation to become a “leading global multi-industrial company.”
He said Tyco “aligns with and enhances” the Johnson Controls building business and further positions the company’s businesses for global growth.
“Through this transaction, we will also expand our ability to further invest globally, develop new innovative solutions for customers and return capital to shareholders,” Molinaroli said.
Johnson Controls’ strategic transformation plan has resulted in significant portfolio changes over the past few years, including the divestiture of its Automotive Electronics and Interiors and Global Workplace Solutions businesses, as well as the acquisition of Air Distribution Technologies and the formation of the Johnson Controls-Hitachi joint venture.
The company announced last July that it’s planning to spin off Adient, its automotive seating and interior business, at the beginning of fiscal year 2017.
George Oliver, CEO of Tyco, said the transaction will allow his company to “better capture opportunities created by increased connectivity in homes, buildings and cities.”
“Joining forces with Johnson Controls pairs our leading established businesses with robust innovation pipelines and extensive global footprints,” Oliver said.