- Delphi to acquire HellermannTyton for
£1.07 billion, expanding its Electrical/Electronic Architecture
global business
- Acquisition of software company,
Ottomatika, and strategic investment in 3D LiDAR company, Quanergy,
boost leading active safety and automated driving capabilities
- Investment in software company Tula
Inc. expands Powertrain offerings
- Company divests reception systems
business
Strengthening its capabilities and portfolio offerings in key
industry growth areas, Delphi Automotive PLC (NYSE: DLPH) has
executed a series of acquisitions, investments and a
divestiture.
HellermannTyton: Delphi has reached agreement on a
recommended offer to acquire HellermannTyton Group PLC (LSE: HTY),
a leading global manufacturer of high-performance and innovative
cable management solutions, for 480 pence in cash per share, which
translates to approximately £1.07 billion of market capitalization
and implies an enterprise value of $1.85 billion at today’s
exchange rate.
The transaction has been recommended by the board of
HellermannTyton and is expected to close late in the fourth quarter
of 2015, subject to regulatory consents and approvals and approval
by HellermannTyton’s shareholders. Upon completion, HellermannTyton
will become part of Delphi’s Electrical/Electronic Architecture
segment.
The acquisition expands Delphi’s product portfolio within the
connected vehicle solutions market and will help capitalize on the
connected car megatrend. It also further strengthens Delphi’s
leading position in the electrical architecture market, while
providing a platform to grow in HellermannTyton’s adjacent
industrial end markets, including aerospace, defense, alternative
energy and mass transit.
“With consumers now demanding more connectivity in their
vehicles, electrical architecture is the enabler to that added
vehicle content,” said Kevin Clark, Delphi president and chief
executive officer. “HellermannTyton positions Delphi to provide
customers with an even broader portfolio of highly engineered and
customized connection systems and cable management solutions. By
leveraging the combined capabilities of both companies, we will be
able to capitalize on additional growth opportunities and create
significant value for our customers and shareholders.”
Strategic and Financial
Benefits
- Extends Delphi’s
leadership in electrical architecture components.
HellermannTyton has a leading market position in providing cable
management solutions in the vehicle and has an extensive range of
products that are mission-critical in nature and are highly
engineered to customer specification.
- Strong growth
fundamentals and EBITDA margins. HellermannTyton has a
well-established track-record of growing 3-5 percentage points
faster than its end markets and has realized top-line constant
currency CAGR of approximately 10 percent per year since 2010,
while maintaining EBITDA margins of approximately 20 percent.
- Transaction is
accretive to Delphi’s EPS. Delphi expects the transaction to
be 15 cents accretive to earnings per share starting in 2016.
- Significant
operating and revenue synergies. The acquisition will also
be immediately accretive to growth and margins based on significant
operating synergies from sourcing and supply chain initiatives.
Delphi has a strong track record of successfully integrating
businesses like HellermannTyton and believes it will be able to
achieve synergies of approximately $50 million per year by the end
of 2018 through sourcing savings, supply chain savings and
leveraging the combined product portfolio.
- Allows Delphi to
capitalize on attractive industrial end markets. The
acquisition of HellermannTyton will enhance Delphi’s already strong
relationships with key global automakers and will provide access to
HellermannTyton’s non-automotive end markets.
Ottomatika and Quanergy: To enhance its leading active
safety and automated driving capabilities, Delphi has acquired
software company, Ottomatika, and has made a strategic investment
in 3D LiDAR sensing leader, Quanergy. These strategic moves
strengthen Delphi’s advanced driver assistance system (ADAS)
applications and could help speed the adoption of automated
vehicles. The ability to detect objects and execute digital
mapping, surface modelling and distant imaging is enabled by the
use of Light Detection and Ranging (LiDAR) scanners.
By combining Ottomatika’s automated driving software with
Delphi’s active safety systems, the two companies have developed a
technology platform for automated driving that enables a vehicle to
make human-like decisions.
Quanergy and Delphi will collaborate to bring a range of
low-cost, high-performance solid state LiDAR products to the
automotive market to provide a complete vehicle perception solution
for Level 3 and 4 automation applications. The prospect of a
lower-cost ADAS solution could bring widespread adoption of the
life-saving active safety technology.
Tula Technology: Delphi also made a minority investment
in Tula Technology, which develops software that provides
cost-efficient, fuel economy gains in cylinder deactivation
technology. Delphi and Tula’s engine control system software can
increase fuel efficiency and cut emissions without sacrificing
drivability or performance. The combined solution will allow the
engine’s cylinders to fire or skip (deactivate) on a continuously
variable basis, which ultimately increases fuel efficiency by up to
15 percent in a cost-efficient manner.
“These companies bring unique and strategic capabilities in
software and sensing technology, strengthening our portfolio in
active safety and fuel economy, two critical long-term growth areas
for the automotive market,” said Jeff Owens, Delphi chief
technology officer. “We have had strong working relationships with
these companies and believe the synergies are excellent. We
continue to explore additional acquisition and investment
opportunities that will enhance our growth in our core safe, green
and connected areas of focus.”
Reception Systems: Additionally, Delphi has entered into
a definitive agreement to sell its reception systems business,
which consists of automotive antennas and in-vehicle TV tuners, to
Northeast Industries Group Corp., a leading Chinese automotive
supplier. Delphi expects to complete the sale in the third quarter
of 2015, subject to regulatory approval.
Conference Call and Webcast
Delphi will host a conference call to discuss financial results
and these transactions today at 8:30 a.m. (ET). A link to the live
webcast of the call and presentation materials will be available on
the Delphi Investor Relations website at
http://investor.Delphi.com/. To participate by telephone, please
dial 888.486.0553 (U.S.) or 1.706.634.4982 (international) 15
minutes prior to the start time of the call and ask to be connected
to the Delphi Automotive conference call. The conference ID number
is 75261541.
About Delphi
Delphi Automotive PLC (NYSE: DLPH) is a leading global
technology company for automotive and commercial vehicle markets
delivering solutions that help make vehicles safe, green
and connected. Headquartered in Gillingham, U.K., Delphi
operates technical centers, manufacturing sites and customer
support services in 33 countries. Visit www.delphi.com.
Forward Looking Statement
This press release contains forward-looking statements within
the meaning of the Securities Act of 1933 and of the Securities
Exchange Act of 1934. These forward-looking statements reflect,
when made, Delphi's current views with respect to current events
and certain investments and acquisitions by Delphi. All statements
that address our expectations surrounding consummation of such
transactions and their impact on Delphi, as well as future
operating, financial or business performance or our strategies or
expectations are forward-looking statements. Such forward-looking
statements are subject to many risks, uncertainties and factors
relating to Delphi's operations and business environment as well as
market conditions, which may cause Delphi’s actual results to be
materially different from any future results, express or implied,
by such forward-looking statements. In some cases, you can identify
these statements by forward-looking words such as “may,” “might,”
“will,” “should,” “expects,” “plans,” “intends,” “anticipates,”
“believes,” “estimates,” “predicts,” “projects,” “explore,”
“potential,” “outlook” or “continue,” and other comparable
terminology. Factors that could cause actual results to differ
materially from these forward-looking statements include, but are
not limited to, the following: our ability to consummate pending
acquisitions and our ability to integrate and realize the benefits
of pending and recent acquisitions; global economic conditions,
including conditions affecting the credit market; the cyclical
nature of automotive sales and production; the potential
disruptions in the supply of and changes in the competitive
environment for raw material integral to our products; our ability
to maintain contracts that are critical to our operations; our
ability to attract, motivate and/or retain key executives; our
ability to avoid or continue to operate during a strike, or partial
work stoppage or slow down by any of our unionized employees or
those of our principal customers, and our ability to attract and
retain customers. Additional factors are discussed under the
captions “Risk Factors” and “Management’s Discussion and Analysis
of Financial Condition and Results of Operations” in our filings
with the Securities and Exchange Commission, including those set
forth in our Annual Report on Form 10-K for the fiscal year ended
December 31, 2014. New risks and uncertainties arise from time
to time, and it is impossible for Delphi to predict these events or
how they may affect Delphi. Delphi disclaims any intention or
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events and/or
otherwise, except as may be required by law.
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version on businesswire.com: http://www.businesswire.com/news/home/20150729006890/en/
Delphi Automotive PLCInvestor Contact:Jessica
Holscott248.813.2312Jessica.Holscott@delphi.comMedia
Contact:Claudia Tapia248.813.1507Claudia.Tapia@delphi.com
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