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Autoliv sees $100M non-cash charge in Autoliv Nissin JV Brake Systems in Q4.

Autoliv announces a one-time, non-cash, goodwill impairment charge and specifies expected one-time costs related to the planned spin-off and public listing of its Electronics business. A non-cash impairment of goodwill in the Autoliv Nissin Brake Systems joint venture, of which Autoliv owns 51%, with a net income effect to Autoliv of approximately $100M in Q4. The total impairment, affecting reported operating income is $234M. There is no effect on adjusted operating income or adjusted earnings per share. It is a non-cash item, which will not affect cash flow, financial targets or the business plan of the Electronics business. It is the outcome of a weaker sales development than anticipated at the start of operations of the ANBS brake control joint venture. Project costs for the separation and spin-off are expected to be up to $70M. Mainly related to accounting, finance, legal, IT and listing. Project costs will be booked in the quarter in which they occur, the majority are not expected to be tax deductible. Tax related costs from the separation of the legal entities in preparation for the spin-off are estimated to be up to $80M. Tax related costs will be recorded at the time of the separation of the legal entities, expected in the first half of 2018. The spin-off of Electronics is progressing according to schedule and is expected to be completed during the third quarter of 2018, subject to market, regulatory and certain other conditions, including approval by Autoliv's board. The spin-off is as previously communicated expected to be tax free to Autoliv shareholders.

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Publication:The Fly
Date:Jan 26, 2018
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