Strattec Security Corp. has sold the ownership of its Vehicle Access Systems Technologies LLC joint venture to Witte Automotive as of June 30.
In exchange, Glendale-based Strattec received $18.5 million, Witte’s 20% minority stake in Strattec Power Access LLC and the net assets of VAST LLC’s Korea branch office.
VAST is a joint venture that grew out of a 2001 alliance between Strattec and the German firm now known as Witte Automotive. The partnership, which added Michigan-based ADAC Plastics in 2006, helped the companies manufacture and market each other’s products in both North America and Europe and then eventually in other markets around the world.
VAST had net sales of $192 million in fiscal 2022 and $210 million in fiscal 2021. With a one-third ownership stake, Strattec realized $181,000 and $2.6 million in net income from the joint venture for those years.
Strattec Power Access or SPA was formed in 2009 to acquire several product lines from Delphi Corp, including power sliding doors, liftgates, tailgates and deck lids. While Witte had a 20% stake in SPA, the business’s financial results are reported in Strattec’s consolidated results.
According to the company’s securities filings, SPA was profitable in fiscal 2021 and 2022 and represented $95.2 million and $95.7 million of net sales.
“After over two decades of a business alliance and JV partnership with Witte, we jointly came to the conclusion that the changing technology in the auto industry, changes in our respective product lines and shifts in global commerce necessitated a rethink of our business relationship. The primary result of this rethinking is the sale of our equity stake in VAST LLC and securing 100% ownership of SPA,” said Frank Krejci, president and chief executive officer of Strattec.
Krejci added the deal would allow Strattec to redeploy financial and technical assets to focus on its own strategic growth opportunities.
“We believe this transaction is a very positive step to allow us to be more focused and competitive in this exciting and once-in-a-lifetime restructuring of a major industry where we are well-positioned to take advantage of new opportunities,” he said. “This includes more of our product applications on Electric Vehicles, growing consumer demand for Power Access products, expansion of electronics capabilities and other new automotive products. It will also give us greater resources to further explore diversification of markets, complimentary technology and regions outside of North America.”
