(Update: details on the new cost savings targets, on the share of Hella capital held by Faurecia to date and on the legal continuity of the Faurecia and Hella companies, which will keep their names)
PARIS (Agefi-Dow Jones)–The new group resulting from the merger between Faurecia and Hella is called Forvia, announced Monday the two automotive suppliers, who raised their forecast of cost savings by 2025.
“Resolutely forward-looking (FORward) and committed to driving the mobility transition on the roads or VIA, Forvia represents the necessary movement and agility as well as the commitment, confidence and action of the new combined group “, specified Faurecia and Hella.
The two companies will, however, continue to exist as independent legal entities and will keep their names, the leaders of the two industrialists said at a conference held on Monday with journalists and analysts.
Faurecia announced last January that it had finalized the acquisition of Hella after acquiring a total of approximately 79.5% of the shares of the German industrialist. “The total value in cash and shares of this acquisition represents an investment of 5.3 billion euros,” said the tricolor equipment manufacturer at the time. “Faurecia now owns more than 80% of Hella’s capital,” Faurecia CEO Patrick Koller said on Monday during the same conference.
Cost savings target raised
Earlier on Monday, Faurecia raised its target for cost synergies linked to the integration of the Hella group, consolidated in its accounts since February 1, 2022. Faurecia now estimates to benefit from cost synergies estimated at 250 million euros per year. in terms of its operating profit (Ebit) in 2025.
“The execution of a major cost optimization and synergy plan will generate Ebit of more than 250 million euros, beyond what was initially announced, with an impact on the income statement of 80 % to be achieved in 2024,” the group said in a statement.
When the Hella takeover project was announced in August, Faurecia announced that it was aiming for annual cost synergies of 200 million euros in its gross operating surplus (EBITDA) in 2025.
Faurecia also confirmed on Monday the financial objectives of the new group for 2025, namely sales of more than 33 billion euros, an operating margin of more than 8.5% as well as a cash flow of around 1.75 billion euros.
Following these announcements, Faurecia shares rose 2.5% around 12:15 p.m. Monday, at 39.61 euros, marking one of the largest increases in the SBF 120 index.
-Julien Marion and Dimitri Delmond, Agefi-Dow Jones; +33 (0)1 41 27 47 31; [email protected] ed: ECH
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February 07, 2022 06:23 ET (11:23 GMT)