TUS International to acquire Telit’s automotive division for US105m
TUS International has conditionally agreed to buy Telit’s automotive division, to further strengthen the intelligent driving systems business of the Group, in a deal reported in The Financial Times to be worth US$105m.
Telit chief executive Yosi Fait told the newspaper that the deal would significantly reduce the company’s debt and provide greater financial flexibility. However, the deal is not set to complete until December as Telit prepares to separate its automotive business from the rest of its operations. The Financial Times reports that the final deal price could rise to US$125m by the time the deal completes.
Telit’s automotive customers are mainly blue-chip OEMs, such as Tesla, and tier-1 suppliers with a record of successful product implementation with more than five million cars using the company’s connectivity modules. The automotive unit is one of Telit’s fastest growing but least profitable divisions and analysts believe the sale will result in a US$50m profit on the company’s investment in this market. The Financial Times report also suggested that the deal could be a precursor to the eventual sale of the rest of Telit.
TUS International is a supplier of advanced driver assistance systems (ADAS) in China as well as a provider of autonomous driving cloud control solutions. The company is dedicated to developing the full-stack autonomous driving system – which consists of deep learning artificial intelligence and the next generation in-vehicle computing platform, and vehicle-to-cloud computing autonomous driving solutions. TUS international had camera-based ADAS shipments of more than 1.3 million in 2017 with a claimed market share of 35% and recorded annual revenue of HK$ 258m (US$32.9m).