Hanon Systems to acquire Magna’s global fluid pressure and controls business for $1.23 billion
20 Sep 2018 | 13302 Views | By Autocar Professional Bureau
Hanon Systems, the South Korean full-line supplier of automotive thermal and energy management solutions for conventional and electrified vehicles has signed an agreement with Magna International Inc to acquire its global Fluid Pressure & Controls business in a transaction valued at approximately $1.23 billion.
The business to be acquired ...
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Hanon Systems, the South Korean full-line supplier of automotive thermal and energy management solutions for conventional and electrified vehicles has signed an agreement with Magna International Inc to acquire its global Fluid Pressure & Controls business in a transaction valued at approximately $1.23 billion.
The business to be acquired provides automakers thermal and energy management solutions that improve conventional and electrified powertrain efficiency, which aligns with the vision of Hanon Systems. Products that are part of this business encompass a range of electronic and mechanical pumps for thermal systems and transmission systems, and brushless DC (BLDC) motor and electronic cooling fan technologies.
Hanon Systems expects this business will significantly contribute to the company’s focus on e-mobility by increasing future business in electrified solutions through its BLDC motor-based electronic cooling fan, electronic water pump and electronic transmission oil pump technologies.
The scope of the transaction includes 10 manufacturing and engineering facilities across Europe, North America and Asia, and approximately 4,200 employees. In 2017, the business to be acquired generated total sales of $1.4 billion. The acquisition is expected in the first quarter of 2019.
Hanon Systems chairman and chairman of Hahn & Company, the company’s majority shareholder, Yeo-Eul Yoon said: “Magna’s global Fluid Pressure & Controls business has a strong reputation and solid customer base. This business is a strategic fit to enhance our company’s capability and competitive position with leading technology for conventional and electrified vehicles. With this acquisition, Hanon Systems is in a better position to satisfy the increasing demands of automakers for electrified thermal and energy management solutions. At the same time, it will further diversify our global customer base, and broaden our global reach and talent base to better serve customers where they operate to deliver even greater value to our stakeholders.”
At year-end 2017, Hanon Systems reported total sales of approximately $4.9 billion. The transaction offers Hanon Systems the opportunity to accelerate growth, and the potential to generate long-term margin improvement through economies of scale and operational synergies.