Bosch offers to acquire remaining stake in Pacifica amidst GM's bankruptcy

17 June 2009

The Germany-based Bosch Group, which already owns a 76.6-per cent stake in Pacifica has offered to by the rest of the company's shares for 23 cents each for a total of $7.6 million.

The bid values Pacifica, the leading manufacturer of automotive brakes at $32.5 million.

The remaining shareholders may find it tough to sell at the price at a time when the market is down, but they would probably consider that bankruptcy of General Motors in the US would impact Pacifica's earnings adversely this year.

GM, which is planning to emerge as a smaller, more focused carmaker, is a major customer of Pacifica.

Pacifica, which posted a $242 million loss last year,  has already warned shareholders to expect losses for the third consecutive year. Pacifica's share price shot by a third to 21.5 cents on news of the Bosch offer, which is subject to certain conditions including Foreign Investment Review Board approval.

The offer is far short of the $300 million the company was valued at by Bosch in 2007 when it won the company's support for an offer of $2.20 per share for full ownership.