Analyst Note| Richard Hilgert |
No-moat rated Magna announced a definitive agreement to acquire narrow moat rated Veoneer for $31.25 per share. Management expects the deal to close before the end of 2021. While it is possible that another bidder might emerge, we think it is unlikely. Neither do we see any difficulties in getting regulatory approval. Magna and Veoneer were both highlighted in our November 2020 Automotive Observer, “Suppliers to Autonomous Driving Technology”. We estimate combined proforma 2021 revenue in advanced driver assistance systems to be roughly $2 billion.