Schaeffler wants to become market leader with Vitesco takeover

The German supplier Schaeffler wants to take over drive manufacturer Vitesco. The companies' complementary assets will be bundled in Schaeffler's E-Mobility Division - "with the ambition to create a market leader in e-mobility."

Image: Schaeffler

Schaeffler’s Executive Board has, with the approval of the Supervisory Board, decided to make a public purchase offer for all outstanding shares in Vitesco Technologies Group AG. Last year, Schaeffler increased its stake in Vitesco to 49.99 per cent. “The tender offer is the first step of a planned three-step overall transaction that will lead to a merger of Vitesco Technologies Group AG into Schaeffler AG,” the company writes.

Specifically, Schaeffler will offer Vitesco shareholders a cash consideration of €91 per share, a 21 per cent premium to the closing price on 6 October. For shareholders who invested in Vitesco since the spin-off from Continental AG, this will result in a premium of around 52 per cent on the initial Vitesco share price of €59.80 on 16 September 2021.

Schaeffler has big plans, especially in the combined E-Mobility Division. Combining Schaeffler’s and Vitesco’s would result in “a pro-forma combined orderbook of around 40 billion euros and high growth potential reaching solid profitability in the medium term.”

For Schaeffler, the plan follows a “compelling strategic logic.” “Especially in the fields of electrification, Schaeffler and Vitesco have highly complementary technology portfolios, allowing the combined company to offer best-in-class solutions across all dimensions, leveraging the accelerating growth opportunities in e-mobility,” the statement said. Other divisions of the combined company (after the Vitesco acquisition) would be Powertrain & Chassis for conventional powertrains and chassis systems, Vehicle Lifetime Solutions for the aftermarket business, the Bearings & Industrial Solution division, which will consist of the former Industrial division, and the Automotive Bearings division.

“With the launch of the tender offer today, we are initiating a transformative move for Schaeffler. By combining Schaeffler and Vitesco, we will build a leading Motion Technology Company with four focused ‘pure-play’ divisions, a balanced well-diversified portfolio, and critical scale across its businesses,” said Klaus Rosenfeld, CEO of Schaeffler AG. “This includes a best-in-class e-mobility champion with significant growth potential. The combination will make Schaeffler and Vitesco stronger together and is beneficial for customers, employees, shareholders and business partners.”


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