BorgWarner Divests BorgWarner Morse TEC To Enstar

(RTTNews) - BorgWarner Inc. (BWA) said that it has divested BorgWarner Morse TEC LLC, a wholly-owned subsidiary of the company that holds asbestos and certain other liabilities, to Enstar Holdings (US) LLC, a subsidiary of Enstar Group. BorgWarner contributed about $172 million in cash to Morse TEC.

As a result of the deal, BorgWarner expects to remove the asbestos obligations, related insurance assets and associated deferred tax assets from the company's condensed consolidated balance sheet.

BorgWarner said it is evaluating the accounting for this transaction, but currently estimates that the transaction could result in an after-tax loss in its consolidated financial statements of up to $40 million in the fourth quarter of 2019.