Valeo says it will boost its position in the global automotive lighting sector by taking full ownership in its North America-based lighting joint venture, Valeo Sylvania.
Valeo will spend $104 million to purchase Siemens sudsidiary Osram's 50 percent stake in the 36-year-old company, which has plants in the U.S. state of Indiana and Queretaro, Mexico.
The deal pays Osram three times the joint venture's earnings before interest, taxes, depreciation and amortization, Valeo said in a statement.
"The takeover of Osram's shares in Valeo Sylvania represents a major step in Valeo's strategy to increase its position as a global leader in automotive lighting," Valeo CEO Jacques Aschenbroich said in the statement.
The deal should be completed by the end of the month, Valeo said.
IHS Automotive analyst Andrew Herzig said the purchase, "helps to align Valeo's automotive lighting presence worldwide by adding North American sales to the rest of its lighting business worldwide."
Herzig, who specializes in European component forecasts and analysis, estimates that Valeo Sylvania already ranks in the top five in North American market share for headlamps and tail lights. (see charts, below)
Valeo also is one of the largest players in the European auto lighting sector along with Magneti Marelli and Hella, IHS estimates.
Herzig predicted that Valeo would also find "big opportunities" in worldwide automotive exterior lighting in the coming decade. "LEDs are increasingly being used for all front and rear lighting functions, with particular growth in LED headlamps forecasted for the rest of the decade," Herzig said. "Adaptive headlamps have and will continue to develop with the advantages that LEDs offer."