BergWarner plans to acquire German battery company Akasol plus car electrification for 754 million euros

On Feb. 15, American auto parts maker BergWarner announced plans to buy German battery maker Akasol (stock symbol: ASL)).

According to information posted on Akasol's website, BergWarner's offer for Akasol is 120 euros per share, meaning Akasol is valued at 730 million euros, well above Friday's share price of 104 euros. The offer is 23.4% higher than the average share price over the past three months and about 44.2% higher than the average share price over the past six months. Considering Akasol's debt of 27 million euros, the total acquisition amount is 754 million euros.

It is understood that the acquisition has been unanimously approved by the board of directors of BergWarner and the supervisory board of Akasol, and is expected to be completed by the end of the second quarter of 2021, subject to regulatory approval and other transaction conditions. After the acquisition, Akasol will operate independently as a brand under BergWarner.

According to public data, Akasol makes battery systems for buses, trains, trucks, industrial vehicles and ships, and customers include large companies such as Daimler, Volvo and Rolls-Royce Power Systems. The company currently has three major manufacturing bases in Europe and North America: Langen and Darmstadt, in Germany and Hazel Park in North America. The company expects annual production capacity to reach 4.7GWh in 2022.

With a history of more than 100 years, BergWarner is the leading global supplier of clean and efficient drive system solutions for internal combustion engines, hybrids and electric vehicles. In its latest earnings report, BergWarner reported sales of $10.165 billion in 2020, the same as the year before, with a profit before interest and tax of $964 million and a margin of 9.5 per cent. Of this total, the sales income of the electric drive and transmission business is 3.989 billion US dollars, the adjusted profit before interest and tax is 359 million US dollars, and the profit margin before interest and tax is 9 per cent.

Early last year, BergWarner announced a $3.3 billion (22.9 billion yuan) wholly-owned acquisition of Delphi Technology. The deal was completed in October last year.

BergWarner said at the time that the deal would give the company many advantages to complement BergWarner's hybrid and electric vehicle powertrain products. On the one hand, it will help to expand the company's product portfolio, capability and scale in electrical and electronic products, and on the other hand, it will help consolidate its leading position in the field of electrical propulsion systems. and strengthen its position in internal combustion engines, commercial vehicles and aftermarket business. In the future, the combined company will launch a more comprehensive product portfolio covering internal combustion engines, hybrids and automotive electric systems.

It is reported that the new combined company will provide customers with a complete set of integrated or independent electrical and electronic products (including high voltage converters, converters, car chargers and battery management systems) and other products in the future.