Irish Firm Sells Majority Stake In Its Chinese Company

Security solutions firm Allegion plc is selling a majority stake in its Chinese firm.

Ireland-based Allegion has signed, through two of its subsidiaries, a definitive agreement to sell a majority stake in Bocom Wincent Technologies Co., Ltd. American Industrial Acquisition Corporation, through an affiliate, is purchasing the majority stake.

Bocom Wincent operates a security system integration business exclusively in China and delivered 2014 revenue and operating income of USD97.3 million and USD4.5 million, respectively.

Allegion will retain 15% ownership in Bocom Wincent. Under the terms of the transaction, Allegion may receive up to USD75 million based on the future performance of Bocom Wincent. Other terms of the transaction were not disclosed. The transaction is expected to close in the fourth quarter of this year, subject to regulatory approvals.

Allegion expects to record a charge from the sale of approximately USD80 million to USD90 million in the third quarter of this year.

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