Magna signs $1.5bn deal with SSW Partners for Veoneer Active Safety

Canadian automotive supplier Magna International will acquire the Veoneer Active Safety business from New York-based investment company SSW Partners in an all-cash transaction valued at $1.525bn.

The agreement complements Magna International’s Go-Forward strategy of investing in high-growth areas and strengthens the company’s advanced driver assistance systems (ADAS) portfolio.

The transaction is expected to increase Magna International’s ADAS business with extensive products, customers, geographies, engineering and software resources.

In addition, the agreement will broaden Magna’s ADAS sensor and full systems capabilities, including radar, camera, ADAS ECU, and driver monitoring.

Swamy Kotagiri — Magna International CEO said: “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.

“We plan to accelerate innovation by building on both organizations’ strengths, including customers, suppliers, technology partners and employees.”

Magna International signs $1.5bn deal with SSW Partners for Veoneer Active Safety. Image courtesy of Magna International Inc.

The transaction is anticipated to increase Magna’s workforce through the addition of 2,200 engineers, including 1,800 for systems, software and sensor development.

The combined entity along with Magna Electronics is projected to have pro forma ADAS sales of around $1.8 billion in 2022 and nearly $3 billion in 2024.

With projected sales of approximately $1.1 billion in 2022 and around $1.9 billion in 2024, Veoneer Active Safety is a Stockholm-based manufacturer of car radar, camera, and other monitoring systems.

Citi served as financial advisors to Magna International while Sidley Austin acted as legal counsel.

The deal is anticipated to close near mid-year 2023 and is subject to certain regulatory approvals and other customary closing conditions.

In October 2021, Veoneer terminated Magna International’s deal to buy all of Veoneer following a superior proposal from SSW Partners and Qualcomm that partnered to acquire the company for $4.5 billion.