Magna to acquire Veoneer Active Safety
by CM staff
The combined business is projected to generate approximately $3 billion in sales in 2024.
AURORA — Magna International Inc. entered into an agreement to acquire the Veoneer Active Safety business from SSW Partners for $1.525 billion in cash, subject to working capital and other customary purchase price adjustments. The combined business is projected to generate approximately $3 billion in sales in 2024.
The acquisition builds on Magna’s Advanced Driver Assistance Systems (ADAS) strengths and positions the combined business with extensive products and capabilities to provide customers with a full suite of ADAS solutions.
The acquisition adds significant engineering resources and expands Magna’s ADAS customer base and geographic diversification.
”This acquisition is consistent with our Go-Forward strategy to accelerate investment in high-growth areas, strengthens our ability to deliver systems solutions to meet customer needs, and positions Magna as a leading full-service ADAS provider,” said Swamy Kotagiri, CEO, Magna. ”We plan to accelerate innovation by building on both organizations’ strengths, including customers, suppliers, technology partners and employees. I am excited to welcome Veoneer Active Safety’s talented employees into our global Magna family.”
The transaction broadens Magna’s ADAS sensor and full systems capabilities, including radar, camera, ADAS ECU and driver monitoring, adds 2,200 engineers, including 1,800 for systems, software and sensor development and additionally Veoneer Active Safety sales are projected to be approximately $1.1 billion in 2022 and growing to approximately $1.9 billion in 2024.
Combined with Magna Electronics, the business is projected to have pro forma ADAS sales of approximately $1.8 billion in 2022, approximately $3 billion in 2024, and is expected to generate higher ADAS content per vehicle opportunities.
Magna expects to maintain a strong balance sheet with an adjusted debt to adjusted EBITDA ratio modestly above Magna’s 1.0 to 1.5 target range by the end of 2023, with continued ample financial flexibility.