German automotive and industrial supplier Schaeffler has reached an agreement on the proposed merger with drive manufacturer Vitesco Technologies, with an improved offer of €94 per Vitesco share, up from the initial €91. Shareholders have until December 15, 2023, to accept the enhanced offer. This revised bid represents a 57.2% premium for shareholders who have held Vitesco shares since the spin-off from Continental AG in September 2021.
Schaeffler, having already increased its stake to 49.99% last year, aims to absorb Vitesco into its operations based in Herzogenaurach. The integration process will be overseen by an “integration committee with equal representation,” consisting of CEOs, CFOs, and HR directors from both Schaeffler and Vitesco. The committee is tasked with developing a business plan for the combined entity by mid-2024. Thomas Stierle, former head of Vitesco's Electrification division, will manage the E-Mobility division and join the future nine-member Group Executive Board.
Schaeffler envisions the merged company offering a seamless product portfolio, particularly in the electrification sector, to capitalize on the accelerated growth potential of electric mobility. The combined entity is expected to generate pro forma annual sales of approximately €25 billion and employ over 120,000 people. Schaeffler anticipates significant synergy potential with an expected annual EBIT effect of €600 million, set to be fully realized by 2029.
Klaus Rosenfeld, CEO of Schaeffler, expressed confidence in the complementary strengths of both companies, stating, “We are pleased that, after intense and, in part, challenging discussions, we came to a business combination agreement, which now lays the ground for a swift and effective integration.”