The auto parts maker has acquired the 50% it did not own in Valeo Siemens eAutomotive, resulting in a net cash outflow of €277 million for the company to acquire its stake from Siemens without debt.
As reported by Valeo in a statement, the operation, which was announced on February 9, was financed with the group’s available cash, while the net debt increased by around 700 million euros, “without substantially changing the global balance of the Valeo’s financial position”, which plans to reduce debt from next year.
The firm pointed out that this operation favors its position as a “major player” in electrification, with a complete range of low and high voltage electric transmission solutions and pointed out that Valeo Siemens eAutomotive will be integrated into its Powertrain Systems division.
Thus, the company’s forecast is that the Powertrain Systems area will increase its turnover to around 8,500 million euros by 2025, compared to the 6,300 million euros that it will enter this year.
In addition, the Ebitda margin of this division will exceed 11% of sales in 2025, compared to the 8% forecast for 2022, while the tax-free cash flow will be around 350 million euros in 2025 and in 2022 it will reach breakeven.
Before this operation, the CEO of Valeo, Christophe Périllat, pointed out that the company is accelerating in the field of electrification and explained that this transaction will serve Valeo to improve its position as “leader in electric mobility”
“We will benefit from the unique expertise in high-voltage electrification developed by the Valeo Siemens eAutomotive teams. In return, the company will benefit from Valeo’s unique ability to innovate and standardize cutting-edge technologies, as well as our operational excellence in the mass production. I would like to thank Siemens for their valuable cooperation over the past years.”