ALMELO, The Netherlands — Sensata Technologies Holding N.V. (NYSE: ST) (the “Company”) announced today that it has reached a definitive agreement to acquire the “Automotive on Board” sensors business of Honeywell International (NYSE: HON) for $140 million in cash.
“This acquisition further expands our leadership in the global automotive sensors market and complements our already strong organic growth in the powertrain segment for our existing pressure products,” said Tom Wroe, Sensata Technologies Chairman and Chief Executive Officer. “It also adds new capabilities in light vehicle speed and position sensing and builds Sensata's market share in Asia – specifically in China, the world's fastest growing automotive sensors market.”
Sensata expects to fund the purchase from available cash resources and anticipates that this transaction will be neutral to 2010 earnings, excluding transaction costs in the range of $3-4 million that will be incurred in Q4 2010. The transaction, which is subject to regulatory review, is expected to close in early 2011. It is expected that the acquisition will contribute to both revenue and Adjusted Net Income growth in 2011 and beyond. The Automotive on Board sensors business has annual sales of approximately $130 million.
“We believe this purchase represents a strategic use of our cash on-hand and meets all our strategic and investment return criteria,” said Sensata Technologies Chief Financial Officer Jeff Cote. “We expect to realize synergies on the integration activities over 18 to 24 months.”