From Automotive News Europe/MEMA Industry News
COBURG, Germany — Continental’s takeover of Siemens VDO Automotive has been good news for Germany’s Brose Group.
Brose, a privatelyheld manufacturer of window regulators, door systems and seat adjusters, agreed last month to purchase the former Siemens VDO’s electric motor operations from new owner Continental.
Brose hopes the acquisition boosts its growth spurt in North America.
Terms of the transaction, which is subject to approval from antitrust authorities, were not disclosed.
Included in the sale is the former Siemens VDO’s electric motor business for window regulators, antilock braking systems, heating and ventilation systems, engine cooling and electric power steering.
The sale also includes Continental’s cooling fan business, which belonged to Continental prior to its historic $16.5 billion acquisition of Siemens VDO finalized last month.
Continental CEO Manfred Wennemer said in a statement that Siemens VDO had considered selling the electric motors unit prior to closing the deal with Continental.
“We resumed those considerations and brought them to a close,” Wennemer said. “Moreover, we’re keeping to our promise of making decisions as quickly as possible during the phase of integrating the former Siemens VDO units so as to eliminate any uncertainties.”
The electric motor unit employs about 4,200 people worldwide and had sales in 2007 of approximately $1.1 billion.
About 30 percent of those sales were in North America to customers such as BMW’s U.S. factory in South Carolina, Volkswagen de Mexico, TRW Automotive and Visteon.
Brose, as the world’s largest buyer of automotive electric motors, is also a major customer, if not the biggest, said Jan Kowal, president of Brose North America.
Between 20 percent and 30 percent of Brose’s electric motors in North America came from the former Siemens VDO, now Continental.
Kowal said it’s too early to say how much Brose will save by producing at least some of its electric motors in-house rather than buying them from Continental.
“The calculation for the acquisition is really based on future expectations of becoming more cost-efficient, but that doesn’t mean we don’t have synergies,” he said. “This does open a couple of new product areas where we think we can contribute: heating and cooling, engine cooling and power steering.”
Brose expects original-equipment sales of about $500 million in North America for 2007 and approximately $300 million with the electric motor business.
