BorgWarner to acquire Remy International

July 14, 2015
Under the terms of the agreement, BorgWarner will acquire all of the outstanding shares of Remy for $29.50 per share, in cash, which implies an enterprise value of Remy of approximately $1.2 billion.

BorgWarner announced July 13 that it entered into a definitive agreement to acquire Remy International, a global market leading producer of rotating electrical components.

With key technologies and operations in 10 countries on five different continents, Remy is strongly positioned to benefit from global growth.  As of December 31, 2014 the company employed 6,600 people and, for the fiscal year, it generated sales of $1.2 billion.

"We look forward to welcoming Remy's talented employees to BorgWarner.  Their products and capabilities will strengthen BorgWarner's position in the rapidly developing powertrain electrification trend," said James Verrier, President and CEO of BorgWarner.  "The acquisition will be another step in executing our plan, to profitably grow revenue to $15 billion by 2020."

Remy Chairman John Weber said, "This transaction provides substantial value to our shareholders, our employees and business partners around the globe. It provides an opportunity to market our products to a much broader and diverse group of original equipment manufacturers. The product and technology synergies are obvious, resulting from each company's historical focus on separate areas of the global powertrain market."  

Remy's President and Chief Executive Officer, Jay Pittas, added, "Our products and capabilities should complement BorgWarner very well and support growing vehicle electrification trends.  We are confident our customers and channel partners will benefit from the strategic fit, as it brings together two long-standing industry leaders."

Under the terms of the agreement, BorgWarner will acquire all of the outstanding shares of Remy for $29.50 per share, in cash, which implies an enterprise value of Remy of approximately $1.2 billion. BorgWarner said it has identified purchasing efficiencies, redundant public company expenses, other cost synergies and numerous opportunities to accelerate growth through the combined business. The transaction is expected to be accretive to earnings in the first year. The completion of the transaction is subject to the approval of Remy's stockholders as well as certain customary terms and conditions, including antitrust and other regulatory clearances in the U.S. and abroad. The transaction is expected to close in the fourth quarter of 2015.

UBS Investment Bank acted as financial advisor and Sullivan & Cromwell LLP provided legal advice to Remy International. BofA Merrill Lynch acted as financial advisor and Sidley Austin LLP provided legal advice to BorgWarner.

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