The founding family owners of Hella KGaA Hueck & Co. of Lippstadt, Germany, a maker of automotive lighting, announced Aug. 14 that it would sell its 60 percent stake in the company to French auto supplier Faurecia SA.
Faurecia was up against two other global automotive suppliers, Plastic Omnium, also based in France, and Germany's Mahle Group in bidding to buy the extensive Hella operations.
Faurecia has more exposure in automotive interiors, although like many plastics suppliers has been positioning itself to grow in electric and autonomous vehicles. Plastic Omnium makes front-end modules and other exterior plastic fascia. It has partnered with Hella in the past in the joint venture HBPO, a maker of front-end modules.
While Mahle has more recognition as a maker of engine systems, filtration and mechatronics, it does have exposure to plastics operations through its heating and air conditioning products.
Nanterre-based Faurecia will pay 6.8 billion euros for the shares, equal to about $8 billion.
"By combining their activities, Hella and Faurecia will become the seventh-largest global automotive supplier," Hella said in a news release. "This opens up significant potential for further profitable growth. Hella and Faurecia today already are global market leaders in their respective fields. By combining their respective strengths [they] aim to further expand their market position, particularly in key growth areas."
Faurecia's North American operations include $130 million worth of injection molding sales, placing it at No. 69 in Plastics News' most recent ranking of injection molders.
Lighting has come a long way since LEDs took over in that business segment, making Hella a more valuable commodity in the bidding. What was once seen as a basic functional piece of the car is now a key design element for individual brands and nameplates.
"This combination is a unique opportunity to create a global leader in automotive technologies," Faurecia CEO Patrick Koller said in the release. "Together, we will have the critical edge to benefit from the strategic drivers that are transforming the automotive industry."