Leoni sells its automotive standard and special cables business
The German supplier of wires, cables and wiring systems has sold its Business Group Automotive Cable Solutions (BG AM), to STARK Corporation.
“With this decision, we strengthen our balance sheet, support the ongoing talks regarding our refinancing and drive forward our well-known strategic focussing on the wiring systems business,” says Aldo Kamper, CEO of Leoni , in a press release detailing the deal.
BG AM is a supplier of automotive standard, special and charging cables and has a worldwide production network of 10 locations in 7 countries – in total the business has around 3,300 employees. STARK Corporation is a Southeast Asian supplier of wires and cables across several industries, with roots dating back to 1968.
The sold activities generated a sales volume of approximately EUR 1.3 billion in the fiscal year of 2021 and are valued with an enterprise value of EUR 560 million. Leoni says that the expected cash inflow is significantly above EUR 400 million and will have a positive effect on the reported free cash flow.
“BG AM’s portfolio, markets and technological know-how ideally complement our strengths. Together with our new colleagues, we are optimally positioned to play a strong role in the international automotive cable business and to further develop our business worldwide,” comments Chanin Yensudchai, Chairman of STARK Corporation.
The completion of the sale is still subject to various closing conditions, including required merger control and investment control clearances, which are expected to be granted within six months.
