Johnson Controls' $7.5 billion joint venture with Yanfeng Automotive Systems was recognized by China Business Law Journal as a 2014 "Deal of the Year."
Cooley advised Johnson Controls on the transaction. Corporate partner Christina Zhang in the Shanghai office and M&A partner Kevin Mills in the DC office led the transaction with critical support from members of Cooley's antitrust team – partner Howard Morse and associate Tanisha James, its CFIUS team – partner Kevin King and associate Christopher Kimball, and the firm's tax department – partner Aaron Pomeroy.
The joint venture will form the largest automotive interiors company in the world with revenues reaching approximately $7.5 billion. Yanfeng will hold a 70 percent share in the joint venture, and Johnson Controls will hold a 30 percent share. The joint venture will be headquartered in Shanghai with global engineering, development and customer centers in the United States, Europe, China, Japan and India. It will have more than 90 plants located across China, Europe and North America.
This transaction represents a new mode of overseas acquisitions by state-owned enterprises. Unlike the common modes of offshore mergers and acquisitions previously adopted under the "go global" strategy, this transaction explores a new route whereby a joint venture controlled by the Chinese Party is established in China by means of equity contribution to integrate global resources.
"It is a great honor to be recognized by such a well-respected legal publication for our work on one of our largest deals in China in 2014," said Zhang. "This commendation is not only reflective of our work on this unique transaction, but is further validation of Cooley's continuing growth and capabilities in China."
Update: In July 2015, the joint venture Yanfeng Global Automotive Interior Systems announced its closing. It is the largest manufacturer of auto interior products in the world, with annual revenue of $8.5 billion.