Fiat and ThyssenKrupp Automotive (TKA) have signed a memorandum of understanding for the acquisition of the Suspension Systems and Shock Absorbers business of Magneti Marelli (MMSS) by TKA.
The parties have agreed on the essentials of an initial purchase of 51 % of MMSS and a put/call option for Fiat and TKA on the remaining shares. The option can be exercised beginning in 2004.
The deal will be submitted for approval to the antitrust authorities and is subject to normal due diligence, which Fiat and TKA expect to be conducted quickly.
The estimated value of the entire transaction is 450 million Euros. The valuation could increase to 550 million Euros, on the basis of the results for the next 3 years.
MMSS is the sole supplier of complete suspension systems for all Fiat car platforms and is a leader in South America for shock absorbers with the Cofap brand. The Suspension Systems and Shock Absorbers business has 15 locations in Italy, Poland, the USA and Brazil.
In 2001, it will generate sales of approximately 1.5 billion Euros. Most of the company`s 5,500 employees are based in Italy and Brazil.