South Korea’s Hyundai Heavy Industries Co. shed Hyundai Ideal Electric Co., its money-losing electric motors making subsidiary in the United States as part of restructuring efforts.
Hyundai Heavy Industries sold Hyundai Ideal Electric to a privately held affiliate of Gulf Electroquip Ltd, electric motors manufacturer based in Texas, U.S., the company announced on Wednesday (local time). The financial terms of the deal were not disclosed.
It is reported that Gulf Electroquip plans to maintain current workforce as well as service guarantees for customers.
Established in 1903 in the U.S., Ideal Electric makes electric power motors and generators. Hyundai Heavy Industries took over the American motor maker in 2007, but decided to sell off the firm as part of its cost-saving scheme, said a Hyundai Heavy Industries.
Hyundai Heavy Industries suffering from liquidity stress amid the prolonged slowdown in shipbuilding industry launched a massive restructuring program last year. It vowed to improve its balance sheet by 3.5 trillion won ($3 billion) through non-core asset sales, reorganization, and business rationalization in return for debt rescheduling by creditors.
Last year, it sold off engine manufacturer Hyundai Cummins Engine Co along with stakes in other companies and disposed Germany-based JaKe and stake in subsidiary Hotel Hyundai this year. It is also preparing to shed HI Investment & Securities Co. to exit from the financial sector this year.
Shares of Hyundai Heavy Industries closed Thursday at 136,500 won, unchanged from the previous session.
The Original Posted By Moon Ji-woong/Maeil Business Korea