© Reuters. FILE PHOTO: The logo of car manufacturer Tesla is seen at a branch office in Bern, Switzerland October 28, 2020. REUTERS/Arnd Wiegmann
(Reuters) – Tesla (NASDAQ:) supplier Aptiv (NYSE:) Plc said on Tuesday it would acquire a majority stake in a unit of Italy’ Intercable for 595 million euros ($605.71 million), allowing the auto parts company access to technology used in electric vehicles (EVs).
U.S.-based Aptiv will own an 85% stake in the unit, Intercable Automotive Solutions, which manufactures high-voltage busbars that carry more electrical power than traditional cables. It has manufacturing facilities in Europe and Asia.
“Intercable Automotive Solutions is an excellent strategic fit with Aptiv’s Signal & Power Solutions segment,” Aptiv Chief Executive Officer Kevin Clark said in a statement.
Auto parts suppliers are increasingly investing in electric and battery technology to cater to the EV market, which could be worth $5 trillion over the next decade.
Aptiv in January announced a multi-billion-dollar deal for software developer Wind River to capitalize on the shift to software-oriented vehicles and diversify its revenue stream.
The deal for Intercable Automotive is expected to close before the end of this year, following which the company will operate as a stand-alone business unit within Aptiv’s Signal & Power Solutions segment.
The transaction is expected to add to Aptiv’s earnings next year.
Goldman Sachs & Co (NYSE:) LLC served as financial adviser for the deal to Aptiv while Clifford Chance was the company’s legal adviser.
($1 = 0.9823 euros)
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