Magna buys Veoneer’s Active Safety Business
The automotive supplier and car parts manufacturer Magna International Inc. has entered into an agreement to acquire the Veoneer Active Safety business from SSW Partners.
The combined business is projected to generate approximately $3 billion in sales in 2024 and will place Magna’s ADAS business in the world’s top group.
The acquisition builds on Magna’s Advanced Driver Assistance Systems (ADAS) strengths and positions the combined business with extensive products and capabilities to provide customers with a full suite of ADAS solutions.
Just over a year ago, Magna already tried to swallow part of Veoneer, namely the Arriver software platform, which is responsible for an automated vehicle’s sensor perception and driving strategy. At the time, the purchase had fallen through – chip designer Qualcomm had outbid Magna and themselves acquired Arriver.
Veoneer, for its part, had been spun off from Veoneer in April 2022. Then, SSW Partners acquired Veoneer in an all-cash transaction representing a total equity value of $4.6 billion. Qualcomm subsequently completed the acquisition of Arriver from SSW Partners for an undisclosed sum. With the announcement to sell the Active Safety business to Magna, Veoneer continues the process of finding the best long-term home for its Restraint Control Systems business.
Magna’s ambitions aim higher
Magna has been rumored for some time to have ambitions for higher heights in the race for electronic vehicle systems. Among other things, the Canadian-Austrian company had bought the technology company Optimus Ride at the beginning of 2022, significantly strengthening its R&D team. In the field of electric drive systems for battery-powered cars and pickup trucks, the Canadians are already at a similar technological level to its main competitors such as Bosch, Vitesco and ZF.
The current acquisition of Veoneers active safety business adds significant engineering resources and expands Magna’s ADAS customer base and geographic diversification. It will broaden Magna’s ADAS sensor and full systems capabilities, including radar, camera, ADAS ECU and driver monitoring. Through the move, the company gains 2,200 engineers, including 1,800 for systems, software and sensor development.
Veoneer Active Safety sales are projected to be approximately $1.1 billion in 2022 and growing to approximately $1.9 billion in 2024. Combined with Magna Electronics, the business is projected to have ADAS sales of approximately $1.8 billion in 2022, approximately $3 billion in 2024, and is expected to generate higher ADAS content per vehicle opportunities.
- Qualcomm beats out Magna in bid for Veoneer
- LG, Magna launch electric drive JV
- Magna JV starts high-volume production of eDrive systems to China
”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. ”We plan to accelerate innovation by building on both organizations’ strengths, including customers, suppliers, technology partners and employees. I am excited to welcome Veoneer Active Safety’s talented employees into our global Magna family.”
Magna will pay for the acquisition $1.525 billion in cash. The transaction is subject to working capital and other customary purchase price adjustments. It is expected to close near mid-year 2023.
Related articles
Magna electric powertrain to hit market in 2022
Veoneer brings new ADAS generation to the road
Autoliv’s electronics spin-off to be named Veoneer
Volvo to split up software company Zenuity
BMW, Qualcomm, Arriver ink strategic collaboration for autonomous driving
