Nidec Sells Subsidiary as CEO Exit Triggers Share Crash
Nidec is selling its electronic parts subsidiary to Carlyle Group while facing a leadership crisis and potential $6.4 billion in impairment charges.
Japanese motor maker Nidec is selling its electronic parts subsidiary, Nidec Components, to the U.S. private equity firm Carlyle Group in a deal valued at more than 100 billion yen ($636 million). This marks the first sale of a major subsidiary for the company, which is currently restructuring following accounting irregularities and scandals.
The company faces severe financial instability, including expected impairment losses in its electric vehicles business and potential new charges totaling 1 trillion yen ($6.4 billion). These challenges have led the Tokyo Stock Exchange to issue a delisting warning to the firm.
Internal turmoil intensified following the announcement that Chief Executive Mitsuya Kishida would exit the company, causing Nidec share prices to drop 21%. In response, Aspex Management, a Hong Kong-based hedge fund and the company's third-largest shareholder, urged the board to retain Kishida. The fund argues that Kishida is necessary to guide the supplier through the current crisis, restore financial reporting, and resolve the threat of delisting.
