• Linamar's agreed cash offer for Montupet at 16% premium
  • Montupet major shareholders agree to tender shares into offer

Canadian auto-parts maker Linamar Corp. has agreed to buy Montupet SA in an all-cash offer valuing the aluminum-castings manufacturer at 771 million euros ($882 million) to add production sites in Europe, North America and Asia.

Linamar will offer 71.53 euros a share for Montupet, a 16 percent premium over its last closing price, the Guelph, Ontario-based company said Thursday in a statement. The French target’s management and major shareholders, who together own 36.6 percent of Montupet, agreed to the transaction and will stay with the company for at least a year after the deal closes.

“Montupet is a technical leader in the market, well-known and respected for its engineering and processing expertise in the cylinder-head segment,” Linamar Chief Executive Officer Linda Hasenfratz said in the statement. “We can jointly offer our customers one-stop shopping for collaboratively designed, cast, fully machined and assembled cylinder heads and other light metal cast products.”

Deals involving auto suppliers have reached a total of $43 billion so far this year, at an average premium of 20 percent, according to data compiled by Bloomberg. That compares with a total of $47.7 billion for the whole of last year. The auto-parts industry is consolidating to save costs and expand offerings as the automakers prefer to work with fewer suppliers.

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