Visteon shares rise 5% as tax seen limited in Halla deal
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DETROIT (Bloomberg) -- Visteon Corp., the auto-parts maker focusing on growing Asian operations, surged to its highest price in three months after a UBS Securities LLC analyst report said there would be a "limited" capital-gain tax impact from divesting its stake in South Korea's Halla Climate Control Corp.
Visteon rose 4.9 percent to close at $41.83 after earlier in the day reaching $43.41, the highest intraday price since May 16.
"The capital gain tax impact of divesting Halla is limited," Colin Langan, a UBS analyst, wrote in a report dated yesterday. "In Korea, the capital gains would likely be exempt from tax under the U.S.-Korea tax law."
Visteon owns 70 percent of South Korea-based Halla. Visteon, based in suburban Detroit, was rebuffed in an attempt to buy the remainder after the National Pension Service, which owns 8.1 percent of Halla, rejected the bid.
The U.S. auto-parts supplier, spun off from Ford Motor Co. in 2000, subsequently changed leadership when CEO Don Stebbins resigned on Aug. 10. Visteon's board installed Tim Leuliette as interim chairman, president and CEO. Visteon, since exiting bankruptcy in 2010, has been shedding lower-margin revenue in vehicle interiors and lighting to focus on faster-growing operations in Asia.
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