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Dec 8 (Reuters) - Engineering products maker TriMas Corp said it would spin off its truck and trailer accessories unit, Cequent, into a standalone company.
Cequent, which makes towing products such as brake controllers, trailer hitches and tow bars, had about $614 million in revenue in the 12 months to Sept. 30.
TriMas said it expected to have a “higher growth and margin profile” after the spinoff, with margin growth expected to exceed 15 percent, excluding items.
The Michigan-based company, which recently lowered its full-year 2014 forecast, said the Cequent businesses would “continue to face additional margin pressures during the back half of 2014.”
Trimas said it expects third party and legal expenses related to the spinoff of about $20 million, which will be incurred over the next several quarters.
Mark Zeffiro, Trimas’ chief financial officer, will be the chief executive of the new company.
TriMas said it expected to complete the tax-free transaction during the middle of next year.
TriMas’ shares rose as much as 4 percent before easing back to trade up 0.7 percent at $32.14. (Reporting by Abinaya Vijayaraghavan in Bengaluru; Editing by Siddharth Cavale and Saumyadeb Chakrabarty)