ABC buying TI, gaining bigger footprint in tanks, fuel systems

Auto supplier ABC Technologies Holdings Inc. is buying Oxford, England-based fuel tank molder TI Fluid Systems plc for about 1 billion pounds (US$1.2 billion), a deal that will more than double the Toronto-based plastics manufacturer's global footprint and greatly expand its product portfolio.

The two auto suppliers announced the deal Nov. 29 following several months of talks, which included two earlier offers dismissed as too low by TI Fluid's board and three deadline extensions that allowed ABC to conduct due diligence.

ABC CEO Terry Campbell said the "transformative strategic opportunity" provides a platform for further growth.

"A combined business will enable us to better serve our customers, and I am excited for our teammates as we continue to build a winning future. We will be persistent in seeking alignment with organizations that have proven capabilities to further ABC's success story," he said in a release.

ABC is mostly known as a maker of interior plastics, but its product lineup includes functional parts such as blow molded HVAC systems, fuel lines, under-the-hood tanks, boots, cargo container systems for trucks and more.

It is No. 9 in Plastics News' ranking of North American injection molders with an estimated $760 million in sales in the region. It is No. 15 among blow molders in PN ranking with $430 million in sales.

TI comes in at No. 18 among blow molders in PN rankings with $255 million in sales. Together, the two companies would represent nearly $700 million in blow molding sales in North America, which could move ABC into the No. 10 spot.

The sale would also bring fuel tank production back as a product strong point for ABC. The Toronto-based company previously had a blow molding tank joint venture, but sold it to China-based Yapp Automotive Parts Co. Ltd. in 2014. TI has two high density polyethylene tank production plants in North America and more worldwide.

ABC employs more than 11,000 across about three-dozen locations in Canada, the United States and Mexico, as well as a handful of others in Europe and Asia.

ABC was founded in 1974.

It is now owned by private equity firm Apollo Global Management Inc. and has been investing in a series of recent acquisitions, allowing it to expand its product offerings.

Since 2022, it has purchased Windsor Mold Group Technologies, Karl Etzel GmbH, Plastikon Industries and dlhBowles Inc.

The company will pay TI Fluid shareholders 200 U.K. pence per share for the company, valuing outstanding shares at just over 1 billion pounds. This represents a 53.4-per-cent premium on the share's closing price Aug. 21, the day before ABC presented its initial offer.

TI Fluid Chair Tim Cobbold, said the deal brings together "two strategically complementary businesses" while acknowledging industry uncertainties.

"The combination will result in a larger, more diversified business with a broader range of products and customers, better positioned to navigate the current challenges facing the automotive industry and deliver sustainable long-term growth," he said in a release.

TI Fluid traces its roots back a century to Detroit's Harry Bundy and Co., which began supplying tubing for the fuel lines in the Ford Model T in 1922. The company went public on the New York Stock Exchange in 1976, before being acquired by TI Group in 1988. As with ABC, it has moved through several private-equity owners in recent years. In 2015, it was acquired by Bain Capital LLC, which refloated shares on public markets in 2017, but remains the company's largest single shareholder.

TI Fluid has 98 manufacturing plants in 27 countries and employs more than 25,000, according to its most recent annual report. Sales are split relatively evenly between its three main markets, with 30 per cent of revenue in 2023 originating in the Americas, 39 per cent in Europe and 31 per cent in Asia-Pacific.

The company produces a broad range of fluid delivery and storage systems, such as fuel tanks, brake lines and battery-coolant modules.

ABC's takeover offer has been unanimously approved by TI Fluid's board, but remains subject to a shareholder vote, among other conditions. The two suppliers expect the deal to close in the first half of 2025.