Novi’s Stoneridge Inc., a company that creates electrical and electronic components for the commercial vehicle and automotive industry, has sold assets related to noncore switches and connectors product lines to Standard Motor Products Inc. in New York for about $40 million.
The transaction is subject to a post-closing inventory adjustment. The two companies have entered into a transition services agreement, supply agreement, and contract manufacturing agreement to help support the transition of the product lines to Standard’s facilities.
Products related to the business are manufactured in Mexico and Massachusetts and include ball switches, ignition switches, rotary switches, courtesy lamps, toggle switches, headlamp switches, and other related components. Stoneridge will retain the Massachusetts facility and other net working capital assets related to the business.
In January, Stoneridge announced Stoneridge 2020, a project designed to focus its business on core technologies to drive sustainable, outsized growth, as well as the closure of its Massachusetts facility. It has begun moving engineering capabilities and will relocate the remaining products manufactured at that location to other North American manufacturing sites. Stoneridge is targeting a closure of the facility by the end of the year and expects to sell it at that time.
“Stoneridge has undergone a significant business transformation to position the company for long-term growth,” says Jon DeGaynor, president and CEO of Stoneridge. “This divestiture is part of an initiative to better align Stoneridge’s operations and engineering footprint and focus resources on the technology platforms and growth products that will drive value for our customers, shareholders, and employees.”