Insight

Automotive M&A Quarterly Newsletter Q2 2021

Read more about M&A activity in the automotive sector

Ford Phillips

Ford Phillips

Managing Director, KPMG Corporate Finance LLC

+1 312-665-1537

Automotive Industry M&A Synopsis and Key takeaways

Landmark M&A Announcement

CentroMotion to Acquire Carlisle Brake & Friction, Creating a Leading Global Technology Player Focused on Mission-Critical Applications for Industrial and Transportation Markets
Enterprise Value (EV)
$375 million
EV / Revenue
1.36x
EV / EBITDA
5.0x


On May 25, 2021, CentroMotion announced an agreement to acquire Carlisle Brake & Friction in a transaction with a total enterprise value of approximately $375 million. The transaction will expand CentroMotion’s portfolio of well-established brands in the industry, including CrossControl, Elliott Manufacturing, Gits Manufacturing, maximatecc, Power-Packer, and Weasler Engineering.

“As we became better acquainted with the CBF team, we found that they share CentroMotion’s commitment to quality, continuous improvement, and a compelling customer value proposition differentiated by subject matter expertise, application knowledge, and leading technologies. Together, an integrated CBF and CentroMotion will serve as a holistic solutions provider to our joint customer base, with unparalleled breadth and depth of offerings across platforms and product lines.”
- Roger Roundhouse, Chief Executive Officer of CentroMotion 

Key takeaways

Facing a numerous supply chain issues, the auto industry may see conditions substantially improve in 2022

  • The automotive industry, looking to overcome a difficult 2020, faced several roadblocks in the first two quarters of the year due to supply chain challenges
  • A severe shortage in semiconductor supply adversely affected the production volumes in the auto industry
  • Mounting headwinds from rising steel prices, container scarcity, labor shortage, and other seasonal factors posed additional challenges
  • The ongoing supply chain constraints are expected to improve in the latter half of 2021 and early 2022
  • 2022 may considerably improve M&A conditions for automotive OEM suppliers, once current challenges are overcome 

Valuation Observations and Sector Performance

  • The valuation multiples for auto parts suppliers have slightly increased over the previous quarter
At the end of Q2’21 the average EV / LTM EBITDA multiples were NA Auto Parts 
Manufacturers
12.5x
(0.6)x Q-o-Q

 

We hope you find this information valuable, and as always, feel free to reach out if you would like to discuss in further detail. To read the full report, download the PDF below.


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