Faurecia, a global automotive technology supplier with its North American headquarters in Auburn Hills, and Hella KGaA Hueck & Co., an enterprise with a similar focus on automotive technology innovation based in Germany, have announced the combination of the two companies creating the seventh largest global automotive supplier.
“This combination is a unique opportunity to create a global leader in automotive technologies,” says Patrick KoIler, CEO of Faurecia. “I am convinced that Faurecia and Hella have an outstanding fit as we share common vision, values, and culture. … Together, we will have the critical edge to benefit from the strategic drivers that are transforming the automotive industry.”
Faurecia will accelerate the multi-pillar business strategy of Hella with a focus on automotive original equipment (lighting and electronics), and additional market segments (aftermarket, services, and special applications).
Lippstadt, the location of Hella’s headquarters will continue to play a major role and will be the headquarters of three business groups of the combined group: electronics, lighting, and lifecycle value management. The management and business CEOs of these three groups will be based there.
The combination will create a focused offering for both battery electric vehicles and fuel cell electric vehicles, building on Hella’s energy management portfolio, sensors, and actuators, as well as Faurecia’s hydrogen system solutions and hybrid systems.
“This move will further improve the strategic positioning of the company – for the benefit of Hella and its 36,000 employees,” says Jürgen Behrend, chairman of the Family pool. “At the same time, the family will continue to accompany the development of this leading European company as a shareholder in Faurecia, With Faurecia as the new majority shareholder, Hella will be able to play to its strengths even more effectively.”
In advanced driver assistance systems and autonomous driving, the combination of the businesses will create a portfolio of radars, electric power steering (including fail operational), e-mirrors, 360-degree views, automated parking solutions, and more.
The completion of the transaction (including the settlement of the public tender offer) and its calendar remain subject to approvals by the relevant regulatory authorities. Faurecia will launch information procedure with European Company Committee and other employee representative bodies. It is expected to close in early 2022.
As part of the agreement with the Family pool and Hella, Faurecia will launch a public tender cash offer of for all Hella shares at $71.85 per share. The total consideration includes the $1.13 dividend expected to be resolved by the Hella annual general meeting on Sept. 30, 2021, and to be paid by Hella to all its shareholders pre-closing.
It will also acquire from the Family pool a 60 percent stake at the share cost of $70.72, paid through a mix of $4.07 billion in cash, and up to 13,571,428 newly issued shares of Faurecia stock.