TriMas Corporation TRS) announced that Horizon Global Corporation, the newly created company from the spin-off of the former’s Cequent businesses will be listed on the New York Stock Exchange, when it becomes a publicly-traded company, under the ticker symbol “HZN”.
In December last year, TriMas had announced that its Board had approved the decision to spin-off its truck and trailer accessories unit, Cequent, into a new stand-alone, publicly traded company. It reflected TriMas’ continued commitment to enhance shareholder value through active management of business portfolio and organizational focus. The spin-off is slated to be completed in mid-2015.
Horizon Global (formerly Cequent) is a designer, manufacturer and distributor of a wide variety of high-quality, custom-engineered towing, trailering, cargo management and other related accessory products on a global basis. It will cater to the automotive aftermarket, retail and original equipment channels. Horizon Global will be constituted of TriMas’ Cequent Americas and Cequent APEA segments, which together generated revenue of more than $600 million in 2014, with a 10% compound annual growth rate from the end of 2010 through 2014.
Horizon Global will employ approximately 2,800 people at 20 facilities across the world. Horizon Global’s management team, including A. Mark Zeffiro, president and chief executive officer, and David Rice, chief financial officer, will be based in the new company’s headquarters in Bloomfield Hills, MI.
The spin-off would provide both the companies with greater flexibility allowing each to focus on their distinct growth and margin improvement strategies. This in turn will increase efficiency and help to generate value for shareholders, customers and employees.
However, headwinds related to continued low oil prices and the stronger U.S. dollar, as well as lower-than-expected macroeconomic growth will continue to dent the company’s revenues. Nevertheless, TriMas remains focused on its ongoing initiatives to drive margin improvement across its businesses by optimizing its manufacturing footprint, exiting lower margin products and geographies, and achieving synergies from previous acquisitions.
TriMas currently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the same space include Global Brass and Copper Holdings, Inc. BRSS, Kaiser Aluminum Corporation KALU and Norsk Hydro ASA NHYDY. All of these stocks carry a Zacks Rank #2 (Buy).
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