FRANKFURT/STOCKHOLM -- German supplier Knorr-Bremse made a 4.86 billion Swedish crown ($568 million) all-cash bid for Swedish brake systems rival Haldex today, reigniting a bidding war by trumping an offer from Germany's ZF.
Automotive suppliers are pushing to add expertise in the area of automation and software to prepare for a new era of autonomous driving.
Recent tie-ups include ZF's $12.4 billion takeover of TRW, Magna's $1.9 billion Getrag purchase and Continental's acquisition of Veyance Technologies. Fiat Chrysler is said to be exploring a sale of Magneti Marelli.
Knorr-Bremse, which makes braking systems for rail and commercial vehicles, said it was offering 110 Swedish crowns per share, beating an earlier 4.4 billion crown ($515 million) cash offer from ZF, which had been the sole remaining bidder after SAF-Holland, which made an initial 4.2 billion crown bid for Haldex, withdrew its bid.
"The offer is clearly friendly and not hostile. I have been in good talks with the chairman of the board of Haldex," Knorr-Bremse CEO Klaus Deller told a conference call following news of the bid.
Haldex shares were up 10.1 percent to 114.5 crowns at 09:47 CET, indicating market expectations of a continued bidding war.
"I don't think this ends here, given ZF is such a strong bidder," Handelsbanken Capital Markets analyst Hampus Engellau said, adding he thought a successful bid would have to be between 115 and 120 crowns.
The board of Haldex, which had recommended the ZF bid, said in a statement it would evaluate the new offer, while ZF said it had noted the rival offer and would assess the situation.
"ZF continues to believe that its cash offer for Haldex at 100 Swedish crowns per share is fair, and adequately reflects the long-term value of a combination of ZF and Haldex," it said.
Haldex's expertise in brake and air suspension components for the trailer segment complements Knorr-Bremse's product portfolio, which comprises braking, steering and powertrain systems as well as driver assistance systems, automated driving functions and telematics.
Knorr-Bremse, which owns 8.37 percent of Haldex shares and votes, said the offer is fully financed by cash available from Knorr-Bremse's own funds, and it is not dependent on any external financing.