Canadian supplier Magna International Inc. said on Tuesday it agreed to buy Veoneer Active Safety from investment firm SSW Partners for $1.53 billion in cash to bolster its portfolio of self-driving technology.
The deal is expected to add to Magna's sensor and full systems capabilities, including radar, camera and driver monitoring, and add 2,200 engineers for systems, software and sensor development.
Veoneer Active Safety sales are projected to be about $1.1 billion in 2022 and increase to about $1.9 billion in 2024.
The deal is expected to close near mid-year 2023, Magna said in a statement.
The sale of the business is not a surprise. SSW acquired the unit in a $4.5 billion transaction in October 2021 that included Qualcomm's purchase of Veoneer's Arriver automated driving software unit. At the time, Magna also was bidding on the same Veoneer assets, but Qualcomm and SSW won the business after they topped Magna's offer by 18 percent.
There was immediate speculation last year that Magna would eventually bid on the Veoneer active safety business lines that Qualcomm didn't want.
“We plan to accelerate innovation by building on both organizations’ strengths, including customers, suppliers, technology partners and employees,” Magna CEO Swamy Kotagiri said in a statement. The company scheduled a morning press conference to discuss the acquisition.
Carmakers and suppliers have been fine-tuning their approach to self-driving and driver-assistance systems after struggling to deliver meaningful progress on deploying robotaxi on public roads. Volkswagen Group and Ford Motor Co. last month pulled their support from self-driving firm Argo, after pouring billions into the startup. Other carmakers like Tesla Inc. have also fallen short on self-driving goals.
Shares in Magna rose 3.2 percent to $58.90 in premarket trading.
Magna ranks No. 4 on the Automotive News list of the top 100 global suppliers with worldwide sales to automakers of $36.2 billion in 2021.
Reuters, Bloomberg and Philip Nussel of Automotive News contributed to this report.