BERLIN, March 28 (Xinhua) -- German auto parts maker ZF Friedrichshafen (ZF) has signed a definitive agreement to acquire Wabco, a U.S. braking system manufacturer for commercial vehicles, ZF announced on Thursday.
ZF would acquire Wabco for 136.50 U.S. dollars per share, meaning a total equity value of about 7 billion U.S. dollars. ZF is expecting to close the transaction at the beginning of 2020.
"We believe that, together with Wabco, ZF can form the world's leading integrated systems provider for commercial vehicle technology," said Wolf-Henning Scheider, chief executive officer (CEO) of ZF.
With the acquisition of Wabco, which recorded total sales of around 3.8 billion euros (4.3 billion U.S. dollars) in fiscal year 2018, ZF would achieve combined sales of around 40 billion euros, according to Germany's third largest automotive supplier.
The acquisition of Wabco could enable ZF to catch up with the two largest German automotive suppliers Bosch and Continental, which generated sales of around 47 billion and 44 billion euros respectively with their automotive sectors in recent years.
After the completed acquisition of Wabco, ZF could also push its Japanese rival Denso out of the third place of the world's largest automotive suppliers.
ZF is expecting high demand in automated driving functions, especially in the commercial vehicle sector and in "areas with low complexity and traffic density" such as factory sites, airports and in agriculture.
With the planned takeover of Wabco, ZF would be expanding its "expertise to include commercial vehicle braking solutions for the first time". This would play a central role for the control of automated driving functions, including emergency braking maneuvers of trucks and trailers.
Back in 2015, ZF had already acquired U.S. supplier TRW Automotive which was specialized on electrically assisted steering systems, driver assistance systems, sensors and electronic components for around 12.4 billion U.S. dollars.
ZF's former CEO Stefan Sommer had already tried to acquire Wabco, but was ultimately stopped by ZF's supervisory board in mid-2017. About half a year later after the failed acquisition, Sommer resigned as CEO at ZF and joined the management board of German carmaker Volkswagen.
