FCA Sells Magneti Marelli to Calsonic Kansei

Fiat Chrysler Automobiles NV has struck a deal to sell its Magneti Marelli partsmaking business to Japan’s Calsonic Kansei Corp.

New York City-based private equity firm KKR & Co. owns Calsonic Kansei and intends to merge the two businesses. The €6.2 billion ($7.1 billion) deal will create an auto parts supply giant with 65,000 employees and annual revenue of about $15 billion.

The combined companies will be headed by Calsonic Kansei CEO Beda Bolzenius. Magneti Marelli CEO Ermanno Ferrari will join the board of the new business.

The sale is the first big FCA deal handled by Chairman John Elkann and CEO Mike Manley, both of whom took over after CEO Sergio Marchionne died unexpectedly in July.

FCA confirmed in April that it was studying options to sell the company rather than spin it off to FCA shareholders. The latter option was favored by Marchionne. The carmaker has been in talks with KKR since August.