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Autoliv sets aside $210 million to cover European cartel investigation

Stock MarketsDec 06, 2018 03:55AM ET
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© Reuters. FILE PHOTO - Autoliv CEO Carlson poses for a picture at company headquarters in Stockholm

STOCKHOLM (Reuters) - Sweden's Autoliv (ST:ALIVsdb) (N:ALV) is setting aside $210 million this quarter to cover a fine it expects the European Commission to impose after a long-running cartel investigation, the car safety equipment maker said on Thursday.

Autoliv, the world's largest airbag maker, has since 2011 been subject to an investigation of anti-competitive behavior among suppliers of so-called occupant safety systems - such as seatbelts, steering wheels and airbags - in the European Union.

The company paid a 8.1 million euro ($9.2 million) fine in the first quarter of this year related to a smaller part of the investigation, completed by the Commission in November 2017.

In that part of the investigation, Toyoda Gosei (T:7282), Takata, Marutaka and Tokai Rika (T:6995) were also fined for taking part in cartels to fix prices for seatbelts, airbags and steering wheels to Japanese carmakers.

"Management now has reason to believe that the EC (European Commission) will seek to impose a fine in connection with the remaining portion of the EC investigation," Autoliv said in a statement.

"According to management's best estimation and based on the advice of our legal counsel, the company will accrue $210 million in the fourth quarter of 2018 in connection with the remaining portion of the EC investigation."

Autoliv said it believed a fine could be issued in the first half of 2019, but noted it could be delayed.

Autoliv's Swedish-listed shares were down 2.7 percent at 0815 GMT, slightly underperforming a 2.5 percent drop for the European automotive sector (SXAP).

The company had previously said it believed the outcome of the Commission's investigation was likely to materially affect operating results.

($1 = 0.8828 euros)

Autoliv sets aside $210 million to cover European cartel investigation
 

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