Prospect of recruitment: New Hella owner does not give a job guarantee

Prospect of attitudes
New Hella owner does not give a job guarantee

After the merger of Faurecia and Hella to form the seventh largest automotive supplier in the world, both sides are trying to dispel the workforce’s job concerns. But there is no promise. The promise of attitudes should provide reassurance.

The French automotive supplier Faurecia does not give any explicit job or location guarantees for the employees after the multi-billion dollar takeover of the German competitor Hella. But the bosses of both companies tried to dispel possible fears of the future of the employees. “We are growing very strongly. We will have to hire people,” said Faurecia boss Patrick Koller. And Hella boss Rolf Breidenbach also emphasized: “We need more hands.” There are no specific plans for job cuts in the administrative area, for example at the Hella company headquarters in Lippstadt. The merger would make Hella’s locations safer rather than unsafe.

Hella 61.10

After the takeover, at which Hella is valued at 6.8 billion euros, Faurecia boss Koller expects a surge in growth for what will then be the seventh largest automotive supplier in the world. Sales are expected to increase from currently 23 billion euros to more than 33 billion euros by 2025. At the same time, profitability should also increase. “This merger is a unique opportunity to create a global leader in automotive technology,” said Koller. The companies complemented each other perfectly and are now clearly geared towards the megatrends in the industry, “said Koller.

“We need Hella – and we believe that Hella needs us too.” In four years, less than ten percent of joint sales will depend on the combustion engine; at Faurecia it is currently a quarter. “We wanted more electronics, more software,” said Koller. The two companies complemented each other – “that is seldom the case”. The Faurecia boss, who has been in office for five years, has both French and German citizenship. From 1991 to 1994 he worked for Hella himself.

The Hella headquarters in Lippstadt will also play a prominent role in the new group. Three of the six company divisions are to be steered from there: lighting, electronics and the growing business with lifecycle value management, with which income is to be generated over the entire life cycle of a product.

Faurecia had announced that it would take over the 60 percent stake in the lighting specialist from the Hella family shareholders Hueck and Röpke. The families will receive 3.4 billion euros of the purchase price in cash, the rest in Faurecia shares. The price is 60 euros per Hella share. At the end of September, Faurecia wants to make the other shareholders an offer, also for 60 euros plus dividends. The acquisition is expected to be completed in early 2022.

Faurecia does not necessarily want to take Hella off the stock exchange after the takeover in order to leverage all synergy potential. “With more than 60 percent, we are in control, which is why we don’t necessarily need more to (…) run the company,” said Koller. But if you could achieve more than 95 percent, Faurecia would take Hella off the stock exchange. “But there is no absolute necessity for that.” The French would then be able to leverage around 85 percent of the total synergy potential. Koller put the total synergy potential at around 200 million euros by 2025.

The traditional brand name Hella, which the company has also had since 1986, is valuable and should continue to be used, said Koller. Even more: “We have to consider whether a new name for the group might not bring value.” Faurecia was created in 1999 from the merger of the suppliers Bertrand Faure and Ecia.