Premium suspension manufacturer Öhlins is to become a subsidiary of Tenneco Inc, joining one of the largest global multi-line, multi-brand OEM and aftermarket companies in the world.
On November 15, Tenneco Inc, one of the world’s leading designers, manufacturers and marketers of ride performance and clean air products and technology solutions for diversified markets, including light vehicles, commercial trucks, off-highway equipment and the aftermarket, signed a definitive agreement to acquire Öhlins Racing AB, the Swedish technology company that develops premium suspension systems and components for the automotive and motorsport industries. Ohlins supports performance teams in F1, Formula E, NASCAR and MotoGP racing.
Öhlins Racing has been an integral part of the motorsport, motorcycle and automotive industry since 1976, when Kenth Öhlin founded the company and created his first legendary motocross shock. Since then, Öhlins has been setting global industry standards by offering state-of-the-art suspension technology to racing teams, OEM partners and aftermarket. With distribution in 50 countries and manufacturing facilities in Europe and Asia, Öhlins has managed to combine global reach with world class industry knowledge.
With the acquisition of Öhlins, Tenneco will enhance its position as leading global designer, manufacturer and distributor of ride performance products and technologies. Öhlins will be a subsidiary of Tenneco and keep both its strong brand and team. Kenth Öhlin will continue to be part of Öhlins and provide continuity in strategic and technological development. He will retain a minority interest in the company and serve on the board of Öhlins.
L-R: Ohlins Racing founder Kenth Öhlin and Brian Kesseler, co-CEO, Tenneco.
Kenth Öhlin said: “Together, Öhlins and Tenneco will be a very strong constellation. After considering the strengths of both companies, I made the hardest decision of my life — to sell my life’s work. I am absolutely convinced that we are going to develop very positively in the future, and that Öhlins will benefit from the opportunities that will now arise due to Tenneco’s entrance.”
“I am proud of the Öhlins team and all we have accomplished over the last 43 years. We are excited to continue to deliver innovative technologies that can accelerate growth with the full strength and resources of Tenneco behind us,” added the renowned suspension manufacturer's founder.
Brian Kesseler, co-CEO, Tenneco. commented, “Tenneco’s 20-year relationship with Öhlins has delivered world class products in the intelligent suspension market and provides a strategic entry into advanced performance communities with premium branded products and proprietary Continuously Controlled Electronic Suspension Valve (CES) technology.”
“Öhlins’ technology team will allow us to rapidly grow our product offerings for current and future customers, as well as help us win a larger share of business in developing mobility markets. I am delighted to welcome the Öhlins team as an important part of our new Aftermarket and Ride Performance company,” he added.
The addition of Öhlins will accelerate the development of advanced original equipment (OE) intelligent suspension solutions, while also fast-tracking time to market. It will also enhance Tenneco’s portfolio in broader mobility markets with the addition of Öhlins’ range of premium OE and aftermarket automotive and motorsports performance products.
The acquisition is expected to close in the first quarter of 2019, subject to regulatory approvals and other customary closing conditions. Total consideration for this acquisition is approximately $160 million, which was contemplated in the leverage targets provided in April 2018 as part of the Federal-Mogul acquisition announcement.
Tenneco, which recorded 2017 revenues of $9.3 billion, has approximately 32,000 employees worldwide. Öhlins, which registered revenue of approximately $130 million for the last 12 months, employs 340 people and is headquartered in Upplands Väsby, Sweden, where the main R&D departments and production site are also located. Öhlins also has branches offices and subsidiaries worldwide: Auto Norden and Öhlins CES in Sweden, Öhlins Asia in Thailand, Öhlins Distribution/Technical Centre in Germany, Öhlins USA in North Carolina.
This acquisition is another indication of the consolidation happening in the global automotive component industry. Recently, Continental AG reached an agreement with the Michigan-based Cooper Standard, on the purchase of its anti-vibration systems (AVS) business inlcuding its interest in the Indian joint venture, Sujan CooperStandard. With this acquisition, Continental is expanding its global presence for anti-vibration and noise reduction technology, particularly in North America.