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Marelli Assets Draw Interest From Stellantis, Nissan
Automakers Discuss Suspensions and Cockpit Operations as Bankruptcy Talks Continue
Key Takeaways:
- Stellantis and Nissan are in talks to buy some Marelli assets as the auto parts supplier reorganizes in Chapter 11 bankruptcy.
- Marelli employs more than 40,000 people and blamed declining customer sales, tariffs and lingering supply chain problems for its financial strain.
- Marelli expects to emerge from bankruptcy this year under lender ownership, but asset deals remain uncertain, people familiar with the talks said.
Stellantis NV and Nissan Motor Co. are in talks to take over some of the assets of Marelli Holdings Co., the global auto parts maker that’s mired in a challenging reorganization in bankruptcy.
Stellantis is in discussions for Marelli’s suspensions business in Italy and some other countries, according to people familiar with the negotiations, asking not to be identified discussing nonpublic information. Nissan is looking at cockpit assets from the supplier in Japan, the people said.
Marelli, created in 2019 through the private equity-backed combination of Italian and Japanese auto suppliers, is going through a complex and lengthy restructuring process after filing for Chapter 11 bankruptcy one year ago. The talks on specific assets are part of broader negotiations to try to save the auto parts supplier, the people said. There is no certainty the deals will be struck, the people added.
Representatives for Stellantis and Marelli declined to comment. Nissan didn’t immediately respond to requests for comment.
The component maker, which makes interiors, climate systems and automotive electronics, sought U.S. court protection from creditors after clients including Stellantis — the maker of Jeep and Fiat — and Nissan struggled with declining sales in key markets. The company also blamed tariffs and lingering supply chain problems that began during the pandemic, according to court papers.
Chapter 11 status gives Marelli breathing room from creditor demands, allowing daily operations to continue while the company attempts to reorganize its debts. Many distressed companies that, like Marelli, have significant assets in the U.S. choose Chapter 11 because it offers a well-tested court process and prospects for speedy emergence.
KKR & Co. formed the company after buying Magneti Marelli from Stellantis predecessor Fiat Chrysler for roughly 6.2 billion euros ($7 billion), and merging it with Calsonic Kansei, a Japanese supplier with ties to Nissan that the PE firm already owned.
Magneti Marelli, founded in 1919, remains a key part of the industrial fabric in Italy’s automotive sector. Beyond Stellantis and Nissan, Marelli clients include German manufacturers such as BMW AG that also are under pressure.
The assets Stellantis is considering include operations in Poland, Brazil and Mexico, the people said. It and Nissan are involved in the restructuring talks due to their close working relationships with Marelli. They are also its largest unsecured creditors, according to court filings.
Marelli has received emergency funding from a group of its senior creditors. The company has said that it expects to emerge from bankruptcy this year, under the ownership of its main lenders. This group includes Strategic Value Partners, MBK Partners, Fortress Investment Group and Polus Capital Management.
A spokesperson for the creditor group didn’t respond to a request for comment.
Marelli already manufactures the components at some Stellantis sites, one of the people said. Apart from the possible portfolio transactions, commitments in terms of future orders from both Stellantis and Nissan will be key for Marelli’s Chapter 11 proceeding, the people said.
Marelli, which employs more than 40,000 people, has been on the back foot for several years as orders fell. Cost-cutting at Stellantis under former CEO Carlos Tavares further undermined Marelli by moving production to cheaper locales and directing supply contracts to lower-cost countries, such as Morocco.
Based in Saitama, Japan, the manufacturer operates more than 150 facilities globally that also supply lighting systems and electric motors. In April, the company named Frederick Henderson as interim CEO.
Written by Alberto Brambilla, Giulia Morpurgo and Albertina Torsoli
