The FINANCIAL — AB Volvo has finalized the sale of Volvo Aero to the global engineering company, GKN, for the equivalent of SEK 6.9 billion on a debt-free basis.
As Volvo Group reported, the transaction was finalized after receiving approval from the appropriate authorities.
The sale is expected to generate a positive nonrecurring effect on operating income of SEK 300 M in the “Corporate functions and other” segment in the fourth quarter, net after reversed depreciations. Financial net debt will be reduced by approximately SEK 5 billion in the fourth quarter.
As a step in further streamlining the Volvo Group toward commercial vehicles, AB Volvo initiated a process of assessing the options of identifying a new owner for Volvo Aero in late November 2011. The company selected GKN plc, a global engineering business that serves the automotive, aerospace and land systems markets. It has operations in more than 30 countries and around 45,000 employees in subsidiaries and joint ventures.