BorgWarner Inc on Tuesday agreed to buy UK-based Delphi Technologies Plc in a $3.3 billion deal, as the U.S. auto parts maker looks to expand in a growing market for hybrid and electric vehicles.
Delphi shareholders will receive 0.4534 shares of BorgWarner for each share held. That translates to $17.39 per share, a premium of about 77% to Delphi’s closing price on Monday.
The equity value of the deal is about $1.5 billion. Delphi had long-term debt $1.47 billion as of Sept. 30.
BorgWarner makes automotive parts including automatic transmissions, turbochargers, emissions systems and thermostats.
Delphi manufactures electronic control modules that manage various powertrain components and other auto parts.
BorgWarner will own about 84% of the combined company after the expected closing of the deal in the second half of 2020, the companies said.
The news was first reported by Bloomberg.
BorgWarner also announced a three-year share repurchase program of up to $1 billion.