TRW Automotive Holdings’ (NYSE:TRW) sale of its suspension unit has advanced beyond the second round, two sector advisors said.
The bidder pool currently comprises mostly Asian strategics, the first advisor said. Both advisors said it was their understanding that TRW was angling for a strategic buyer, adding that, to their knowledge, sponsors did not advance into the second round of bids, on 17 March.
It appears that TRW would prefer a strategic buyer given that a strategic would be able to extract synergies from the business, they said, declining to elaborate.
The company has further management presentations scheduled through April and is looking to wrap these up soon, according to both advisors.
In February, this news service reported that TRW and Germany-based ZF Friedrichshafen had mandated BNP Paribas to sell TRW’s suspension business. Books had already been sent to prospective suitors on the unit, which manufactures track rod ends, control arms and ball joints for steering and suspension purposes and has around USD 40m to USD 50m in EBITDA. Sources estimated that TRW could receive offers that value the unit at 6x EBITDA.
Last month news reports indicated that India’s Amtek Auto (BOM:520077) was in talks to acquire the unit from TRW. Amtek declined to comment on the rumors. ZF declined to comment, while TRW did not return calls.
The European Commission has made the divestment a condition to approving ZF’s USD 13.5bn bid for TRW announced back in September.