German-U.S. car parts tie-up could spark more deals -analysts

Fri Jul 11, 2014 2:55pm EDT
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* ZF Friedrichshafen in talks with rival TRW

* Size of deal makes counterbid unlikely -bankers

* Successful takeover could prompt disposals

* Auto suppliers eye driver-assistance market

By Arno Schuetze and Andreas Cremer

FRANKFURT/BERLIN, July 11 (Reuters) - German car parts maker ZF Friedrichshafen's takeover offer for rival TRW looks unlikely to draw rival bids for the U.S. company but could trigger further deals down the line, bankers and analysts said on Friday.

Privately held ZF, a powertrain and chassis specialist, said on Thursday that it was in early talks to buy TRW in a deal that would create one of the world's biggest component makers with combined revenue of $40 billion.

The deal would expand ZF's mechanics-heavy portfolio to include airbags, collision sensors and other electronics with possible applications in self-driving cars - an area where investment is booming to reflect potentially high returns.

In a statement confirming the "preliminary, non-binding" approach, TRW said on Thursday that its board was also evaluating "other strategic alternatives which may enhance stockholder value".   Continued...