Johnson Controls announced Sept. 8 that its board of directors has approved the previously announced spin-off of its global automotive seating and interiors business.
The transaction will result in two independent, publicly traded companies: Johnson Controls International plc and Adient plc. The spin-off is expected to be completed on Oct. 31, 2016.
At the time of the separation, Adient will be the world's largest global automotive seating supplier, supporting all major automakers in differentiating vehicles through superior quality, technology and performance. Johnson Controls will continue to operate as a global leader in building products and technology, integrated solutions and energy storage.
"Today's announcement is an important step as Adient continues on its path toward becoming an independent company," said incoming Adient Chairman and Chief Executive Officer R. Bruce McDonald. "As the market leader in the automotive seating industry, Adient is well-positioned for growth and margin expansion as we commit to reinvesting in the business on a global basis."
The separation will occur by means of the declaration of a dividend in specie of the automotive seating and interiors business, to be effected by the transfer of the automotive seating and interiors business from Johnson Controls to Adient plc and the issuance of ordinary shares of Adient directly to holders of Johnson Controls ordinary shares on a pro rata basis.
The distribution is expected to occur prior to the open of business on Oct. 31, 2016. Each Johnson Controls shareholder will receive one ordinary share of Adient for every 10 ordinary shares of Johnson Controls held as of the close of business on Oct. 19, 2016, the record date for the distribution. No fractional shares of Adient will be issued; Johnson Controls shareholders will receive cash in lieu of fractional shares. No action or payment is required by Johnson Controls shareholders to receive ordinary shares of Adient in the distribution.
Adient ordinary shares are expected to begin trading on the New York Stock Exchange on Oct. 31, 2016 under the symbol "ADNT." The company expects "when-issued" trading for Adient ordinary shares to begin Oct. 17, 2016 and continue through Oct. 28, 2016.
Beginning on Oct. 17, 2016 and continuing through Oct. 28, 2016, it is expected that there will be two markets in Johnson Controls ordinary shares: Johnson Controls shares that trade in the "regular-way" market will trade with an entitlement to Adient ordinary shares to be distributed pursuant to the distribution; shares that trade in the "ex-distribution" market will trade without an entitlement to Adient ordinary shares.
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