DETROIT — Continental AG and Motorola have entered into an agreement under which Continental will acquire Motorola’s automotive electronics business for approximately $1 billion in cash. The transaction includes Motorola’s controls, sensor, interior electronics and telematics businesses. The acquired business will be integrated into Continental’s Automotive Systems Division. The transaction is expected to be completed in the first half of 2006, and is subject to customary closing and regulatory conditions.
“This strategic move will further strengthen our position as a safety and systems supplier to the automotive industry and will give us a real push forward in automotive electronics,” said Continental’s Executive Board Chairman Manfred Wennemer. “Motorola’s automotive electronics business is a perfect fit with our strategy of providing sophisticated safety systems to our customers. …This is a perfect example of our strategy to improve our sales and operating profits with organic growth as well as sound acquisitions.”
Motorola’s automotive unit currently is a component of its networks & enterprise business. The unit employs nearly 4,500 employees worldwide, of which approximately 80 percent are based in North America. Manufacturing facilities and development engineering centers include locations in North America, Japan, China, Mexico, France, U.K. and Germany. Major customers include General Motors, Ford, Daimler Chrysler, BMW and Cummins.
The business has three major product lines focusing on electronics parts and supplies telematics; powertrain and chassis control; and body electronics. The telematics line adds a new set of technologies for Continental. It will be integrated as a new business unit into the Automotive Systems Division.
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