Adient said it has agreed to sell its 30% ownership stake in YFAI to Yanfeng for US$ 379 million. Both companies have also agreed to extend the term of their YFAS joint venture to December 31, 2038. In addition, Adient has agreed to sell certain patents and other intellectual property exclusively used in its seating mechanisms business to Adient Yanfeng Seating Mechanisms (AYM) for US$20 million, and AYM will license such intellectual property back to Adient. Going forward, Adient and AYM said they have also agreed to license to each other certain other intellectual property related to the seating mechanisms business.

Further, Adient and Yanfeng have agreed to amend the AYM joint venture agreement to update AYM’s business scope to allow AYM to carry out its seating mechanisms business both in and outside of the People’s Republic of China (PRC) for both PRC and non-PRC customers. Adient, which will continue to hold a 50% ownership interest in AYM, said it intends to leverage AYM’s expanded presence in the global seating mechanisms market as it continues to right-size its own metals business. Proceeds from the transactions are expected to be used by Adient to pre-pay a portion of the company’s debt and for general corporate purposes.

Adient’s first quarter 2020 financial results were impacted by one-time, non-cash charges, first quarter GAAP net loss and EPS diluted of US$167 million and US$1.78 respectively. Adjusted EPS diluted was US$0.96 in the quarter, while adjusted EBITDA was US$297 million, up U$121 million year-on-year. Adjusted EBITDA margin was 7.5% in the period, up 330 bps compared with the same quarter in the previous year. Gross debt and net debt totalled US$3,754 million and US$2,789 million, respectively, on December 31, 2019.