Report – Magna close to inching purchase of Getrag image

The reports on Magna International’s desire to acquire German transmission maker Getrag are now stating the two companies are near to closing the deal, according to sources that have knowledge of the proceeds.

We reported earlier this month the North American supplier was mulling a purchase of Getrag, one of the biggest independent makers of transmissions, and now the latest report says the negotiations are almost over between the two parties. Magna is North America’s largest auto parts manufacturer and together with Germany’s Getrag they could announce the settlement as soon as this week, according to the people, who opted to remain anonymous because the discussions are still private. The sources point out the ruling family behind Getrag had envisioned either a sale or an initial public offering as other auto suppliers became interested in the independent transmission maker. According to data from Bloomberg, Magna’s powertrain systems division, which should incorporate Getrag, delivered almost $5 billion in sales last year, or around 14 percent of total revenue.

“They have never had full transmission capabilities, so obviously Getrag would fill that void,” comments David Tyerman, a Toronto-based analyst with Canaccord Genuity. Magna is already a key supplier in the field of transmission cases and other technologies, with the addition of Getrag delivering a significant boost to the business sector – with expansion options as more automakers become clients. Getrag was founded back in 1935, when Hermann Hagenmeyer established the transmission producer in southwest Germany. The company had sales of $3.6 billion back in 2013, the latest available data shows.

Via Automotive News