The Canadian company’s chief executive said in an interview yesterday that auto parts maker Magna International Inc has room to grow, but it won’t bid for PSA Peugeot Citroen’s stake in auto parts maker Faurecia.
The fortunes of Magna, which counts Detroit’s Big Three among its major customers, have risen as the U.S. auto sector recovers after the 2009 bankruptcies of Fiat SpA’s Chrysler and General Motors. CEO Don Walker also said that strong U.S. vehicle demand was pushing plants to capacity and could leave automakers scrambling to increase production.
Speaking at the company’s Investor Day, Magna executives said the company had the balance sheet and cash flow to support growth. But it would not make an acquisition simply to use the cash, and Walker dismissed a Bloomberg report that Magna could be interested in Peugeot’s 57 % stake in Faurecia.
“If you look at our history, we would consider looking at business units that we can buy and run and control and own,” he said. “They’re talking about selling some shares in a public company. I don’t know where the rumor came from, but it’s not something we’d be looking at doing.”
The report was spurred after Reuters, quoting sources with knowledge of the situation, reported last week that Peugeot might sell its Faurecia stake as part of talks with its Chinese partner, Dongfeng Motor Group Co Ltd.