Thursday, February 2, 2023
HomeMarketMagna International to Buy Veoneer Active Safety for $1.5 Billion

Magna International to Buy Veoneer Active Safety for $1.5 Billion

Magna expects the combined advanced driver assistance systems business to generate $3 billion in sales by 2024.

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Courtesy Magna International Inc.; Veoneer, Inc.

Canada’s
Magna International
agreed to buy Veoneer Active Safety from investment firm SSW Partners for $1.525 billion, picking up the leftovers of auto-parts maker Veoneer after losing out in a bidding war for the rest of the business last year. 

Magna
(ticker: MGA) —one of the largest auto-parts suppliers in the world — said the deal adds to its portfolio of advanced driver assistance systems, or ADAS. 

Veoneer Active Safety’s sales are projected at around $1.1 billion in 2022, growing to approximately $1.9 billion in 2024. The combined ADAS business is expected to generate around $3 billion in sales in 2024. 

“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 Magna CEO Swamy Kotagiri in a statement. 

The deal represents partial consolation for Magna after it lost out on acquiring the whole of Swedish company Veoneer. It was trumped by chip maker
Qualcomm
(QCOM), which acquired Veoneer’s Arriver sensor and driving software platform in 2021, with SSW taking on the rest of the business in a deal worth $4.5 billion overall. 

Magna shares traded in the U.S. were up more than 3% in premarket trading on Tuesday.

Write to Adam Clark at adam.clark@barrons.com

Credit: marketwatch.com

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