FRANKFURT: German auto parts maker ZF Friedrichshafen has agreed to buy US rival Wabco for over $7 billion in cash in a bid to bulk up its expertise in trucks and driver-assistance systems, the companies said on Thursday.
The all-cash deal is for $136.50 per share and represents a 13 per cent premium to Wabco’s closing price of $120.75 on February 26, the day before the American company said it had been approached by ZF.
ZF, which helps carmakers develop gearboxes and hybrid drivetrains, has been on the lookout for a strategic partner after an analysis that showed that semi-autonomous driving functions and vehicle connectivity will develop into important new business areas.
The two companies said the deal, which is expected to close in 2020, had been unaminously approved by Wabco’s board of directors.
Wabco specialises in advanced driver assistance systems for trucks and trailers, key building blocks for developing autonomous driving technologies, a major growth area for ZF.
Last month Wabco, which is headquartered in Brussels, Belgium but has its executive offices in Auburn Hills, Michigan, confirmed that it had been approached by ZF Friedrichshafen regarding a potential takeover.
Wabco shares were suspended from trading on Thursday after closing at $146l.01 on Wednesday.