Dive Brief:
- Solero Technologies will acquire Kendrion’s U.S. and European automotive business, expanding its product offerings, geographic footprint and customer base, the company announced in a press release Monday.
- The Rochester Hills, Michigan OEM supplier, which offers transmission and engine solenoids, accumulators and hydraulic control modules, will complete the transaction with support from Los Angeles-based private equity firm Atar Capital.
- The deal would expand Solero Technologies’ global presence with the addition of five European plants located in the Czech Republic, Germany and Romania, as well as one plant in the U.S.
Dive Insight:
The deal brings benefits to both companies: With the purchase, Solero Technologies will be able to grow its revenue, while Kendrion’s divestment will help it focus on its industrial strategy.
While Solero Technologies did not disclose the terms of the deal, it acknowledged the purchase would double its annual revenues. Meanwhile, Kendrion said the transaction had an enterprise value of 65 million euros ($69 million), and its divestment accounted for 210 million euros in annual revenue.
In a release, Kendrion said the deal, accounting for 80% of the company’s automotive business, will enable it to strengthen its position in the worldwide transition to electrification and sustainable energy.
“Kendrion’s automotive product portfolio is complementary and well aligned with Solero Technologies’ inorganic growth strategy,” said Dr. Donald James, CEO of Solero Technologies, in the release. “The combined company will be well-positioned for capitalizing on global opportunities that support the industry transformation to electrification and sustainability.”
In addition to solenoids and electronic modules, Kendrion’s automotive products include drive components and clutches, sensors, sound systems, valves and other control technologies, according to the company’s website. As part of the strategic repositioning, Kendrion said it will focus its product development resources entirely on its industrial segments and China.
“The transaction will strengthen our ability to invest in the significant opportunities in the Industrial sector fuelling further profitable growth,” Joep van Beurden, Kendrion CEO, said in the release. “With Solero Technologies and support from Atar Capital, our Automotive business in Europe and the US will become part of a pure play Automotive company, fully dedicated to the sector in these regions.”
Atar Capital bought Solero Technologies, formerly called BorgWarner North American Controls, in 2021.
The deal is expected to close in Q3 2024, subject to customary conditions.
