BorgWarner plans to acquire Delphi Technologies for USD 3.3 billion
By Akshay Kedari  Date: 2020-01-30

BorgWarner plans to acquire Delphi Technologies for USD 3.3 billion

The auto-parts giant intends to gain edge in electric cars leadership with the strategic buyout

BorgWarner, a leading US-based automotive industry components and parts supplier plans to acquire Delphi Technologies for USD 3.3 billion in an all-stock deal, in a bid to gain leadership in propulsion systems for electric cars. Delphi Technologies is a provider of automotive parts and equipment.

The Delphi Technologies-BorgWarner deal is expected to consolidate BorgWarner's power electronics business. Apparently, BorgWarner has also announced a USD 1 billion stock buyback.

Frederic Lissalde, Chief Executive Officer of BorgWarner was reportedly quoted saying that the recent transaction represents a next big step in the balanced propulsion strategy of the automotive components & parts supplier company, which is likely to strengthen its position in electrified propulsion, as well as combustion, aftermarket, and commercial vehicle businesses.

As per sources close to the matter, shareholders of Delphi will receive 0.4534 share of BorgWarner’s stock for each Delphi stock owned. BorgWarner will be paying around USD 1.5 billion for Delphi. Along with the assumption of debt, the transaction is worth around USD 3.3 billion. On closing of the deal, BorgWarner stockholders would own around 84% of the combined company, while the rest will be owned by Delphi Technologies stockholders.

If the deal wins consent, it is expected to close by the second half of 2020.  Also, it will be ‘meaningfully accretive’ to adjusted earning per years (EPS) in the second full year after closing and to deliver USD 125 million in cost synergies by 2023.

The deal comes on the heels of car demand slowing down while global automakers have invested USD 225 billion to develop electric cars by 2023 in the midst of tougher fuel-efficiency regulations. This is in addition to USD 61 billion being spent on self-driving cars, according to business experts.

Source Credit: https://www.investors.com/news/delphi-stock-pops-borgwarner-megadeal-seeks-electric-cars-lead/

About Author

Akshay Kedari    

Akshay Kedari

A qualified computer engineering graduate, Akshay Kedari takes pride in having his way with words. Following his passion for content creation, he writes insightful pieces on aeresearch.net and a few other portals. Also endorsed with a short-term experience in web deve...

Read More

More News By Akshay Kedari

Uber halts decision to shift APAC headquarters from Singapore
Uber halts decision to shift APAC headquarters from Singapore
By Akshay Kedari

Uber Technologies Inc., the American ride-hailing giant, has reportedly halted the company’s decision to relocate its Asia Pacific headquarters from Singapore to Hong Kong until December 2022. Sources cite that the company’s decision was...

PCI Pharma extends global clinical supply-chain services in Europe
PCI Pharma extends global clinical supply-chain services in Europe
By Akshay Kedari

U.S. based biopharmaceutical and pharma outsourcing services company, PCI Pharma services has reportedly announced that it reached a noteworthy milestone through the development of COE (Clinical Center of Excellence) in Berlin. According to credible...

Dassault to use Proxem’s AI solution to advance 3DEXPERIENCE platform
Dassault to use Proxem’s AI solution to advance 3DEXPERIENCE platform
By Akshay Kedari

French software company, Dassault Systèmes has recently revealed plans to enhance its 3DEXPERIENCE platform’s collaborative data science abilities, allowing customers to take advantage of their data patrimony by taking part in new v...

EvoNexus partners with Qualcomm to deploy 5G Incubator program
EvoNexus partners with Qualcomm to deploy 5G Incubator program
By Akshay Kedari

California-based technology startup incubator, EvoNexus has recently partnered with Qualcomm to launch its 5G incubator program. Reportedly, Qualcomm would function as a sponsor of this initiative to assist budding startups to build their 5G wireless...

University of California launches unified COVID-19 research data center
University of California launches unified COVID-19 research data center
By Akshay Kedari

The University of California Health has reportedly launched a secure and centralized database known as UC CORDS in a bid to accelerate COVID-19 research. Sources with the relevant information stated that researchers will gain access to around 460 mi...