TORONTO — Magna International Inc. plans to spin off its largest single plastics business, Decoma International Inc.'s exterior plastics operations, which injection mold bumper systems and body panels.
Officials of auto parts major Magna said at the company's annual meeting Dec. 4 in Toronto that the exterior operations represent about C$500 million (US$352 million) of Decoma's total sales of C$951 million (US$669.5 million) for the year ended July 31.
Magna will keep other Decoma operations such as ornamental components, trim and roofing systems. It will retain majority control of the new company, which it plans to spin off by March. The deal will raise about C$100 million (US$70.4 million) for Magna, which will reinvest it in the new company.
Plastics News estimated Decoma's total injection molding sales at about US$573.2 million for the year ended July 31, 1996. Its eight plants operate about 70 presses, most of them large-tonnage machines making large exterior auto parts. Decoma ranked as North America's third-largest custom injection molder in Plastics News' survey earlier this year.
Magna's spinoff of a chunk of Decoma mirrors its 1995 spinoff of powertrain systems supplier Tesma International Inc., in which it holds majority control.
Magna, based in Markham, Ontario, said it also may bid for Delphi Interior & Lighting Systems' seating operations and build one or two plants in Brazil and Argentina.
In addition, the company said it plans to create a new division called Symatec to create teams of employees that will work on complete auto systems.
Magna's sales grew about 30 percent to C$7.7 billion (US$5.4 billion) for the year ended July 31.
Magna also confirmed at the meeting that it completed the previously announced deal to buy the plastics products division of Ymos AG of Obertshausen, Germany. The Ymos business has four plastics processing plants making interior and exterior auto components and has annual sales of about C$275 million (US$193.6 million).