Sage Automotive Interiors has agreed to pick up the automotive fabrics operations of global car seating group Adient in a deal worth USD 175.00 million.
The company is hoping the acquisition will expand capacity and capability in its proven field, particular in Europe as the textile facilities have a number of locations in the region.
Adient has included its lamination business as part of the transaction, which it said is in line with its strategy of focusing on its core, high-volume seating unit.
Proceeds from the deal are expected to be used to pre-pay a portion of the company’s debt and for general corporate purposes.
Completion is slated to occur before the end of the calendar year, pending regulatory approvals and local legal requirements.
The vendor’s chief executive, Doug Del Grosso, said: “As Adient continues to focus on its core business, we believe that the sale of our fabrics operation to Sage better positions that business for growth and long-term successful performance.”
With a total 11 facilities, the majority of which are in Europe, the automotive fabrics business has around 1,300 employees.
It is expected to generate earnings before interest, taxes, depreciation and amortisation of slightly less than USD 20.00 million on revenue of around USD 240.00 million in fiscal 2020.
Sage is billed as one of the world’s leading providers of automotive interior materials including seating, door panel surfaces and headliners to original equipment manufacturers.
It has offices in the US, Japan, China, Brazil and Mexico, as well as having a presence in Europe which it is looking to expand through this acquisition.
Dirk Pieper, chief executive of the acquiror, noted: “Europe continues to be a key growth area for Sage Automotive Interiors.
“In addition, the technology and capabilities that will now be part of Sage Automotive Interiors will strengthen our ability to serve customers from our current locations in Europe and the rest of the world.”
Motor vehicle parts manufacturers have been targeted in 106 deals announced worldwide in 2020 to date, according to Zephyr, the M&A database published by Bureau van Dijk.
BorgWarner acquired an 84.0 per cent interest in UK-based Delphi Technologies for USD 2.77 billion in the largest of these.
© Zephus Ltd