BorgWarner, the tier one automotive parts manufacturer, has announced that it will spend $950m to buy Remy International, a manufacturer, remanufacturer and distributor of parts including starters, alternators, and hybrid power technology.
The acquisition is expected to be completed in the fourth quarter of this year.
A spokesperson from BorgWarner told Automotive Logistics, “We have identified at least $15m of run-rate cost synergies within two years of closing. That includes purchasing efficiencies and redundant public company expenses. We are currently going through the approval and integration planning processes, so it would be premature to discuss any specific details at this time.”
The deal announcement is one of several in recent weeks. Magna has just announced its plans to buy Getrag; Johnson Controls and Yanfeng Automotive Trim Systems completed a joint venture earlier in July; and Delphi Automotive is selling its thermal business to Mahle.
However, the BorgWarner and Remy deal is under investigation by WeissLaw, a national class action, shareholder rights law firm. The issue is focusing on possible beaches of fiduciary duty and law violations by Remy’s board of directors in agreeing to sell to BorgWarner.
The law firm is looking into whether Remy’s board have acted to maximise shareholder value prior to entering the agreement.
