ITW To Buy ZF TRW Engineered Fasteners And Components Business For $450 Mln

(RTTNews) - Illinois Tool Works Inc. (ITW) said it has reached a definitive agreement to acquire the Engineered Fasteners and Components business or EF&C from ZF TRW for about $450 million. The transaction is expected to close in the first half of 2016.

EF&C, a supplier of engineered fastening systems and interior technical components to the Automotive OEM market, generated revenues of about $470 million in 2015. Headquartered in Germany, the company operates 13 manufacturing facilities globally and employs about 3,500 people.

ITW plans to fund a majority of the acquisition with non-U.S. cash. Including all acquisition related non-cash costs, the company expects the acquisition to be slightly accretive to earnings per share in the first 12 months and to generate long-term returns on invested capital at or above the company's 20-plus percent target.

ITW Executive Vice President Sundaram Nagarajan said, "The Engineered Fasteners and Components business will be a highly complementary addition to ITW's Automotive OEM segment that will broaden our ability to serve our customers and further expand our long-term organic growth potential. In addition, we believe there will be significant opportunity to enhance the performance of the business through the application of ITW's 80/20 business process."