Magna will grow, but not via Peugot's Faurecia, CEO says

Thu Nov 21, 2013 7:11pm EST
 
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Solarina Ho

TORONTO (Reuters) - Auto parts maker Magna International Inc MG.TO has room to grow, but it won't bid for PSA Peugeot Citroen's PEUP.PA stake in auto parts maker Faurecia EPED.PA, the Canadian company's chief executive said in an interview on Thursday.

CEO Don Walker also said that strong U.S. vehicle demand was pushing plants to capacity and could leave automakers scrambling to increase production.

The fortunes of Magna, which counts Detroit's Big Three among its major customers, have risen as the U.S. auto sector recovers after the 2009 bankruptcies of Fiat SpA's Chrysler FIA.MI and General Motors Co GM.N.

Magna shares have risen to record highs this year, up some 65 percent in New York. Magna plans to release new 2014 forecasts at the Detroit Auto Show in January.

Speaking at the company's Investor Day, Magna executives said the company had the balance sheet and cash flow to support growth.

But it would not make an acquisition simply to use the cash, and Walker dismissed a Bloomberg report that Magna could be interested in Peugeot's 57 percent stake in Faurecia.

"If you look at our history, we would consider looking at business units that we can buy and run and control and own," he said.

"They're talking about selling some shares in a public company. I don't know where the rumor came from, but it's not something we'd be looking at doing."   Continued...

 
Chief Executive Officer for Magna International Inc. Donald Walker waits for the annual general meeting to start in Toronto May 10, 2012. REUTERS/Fred Thornhill