Gentherm Acquires Modine’s Performance Technologies Business for $1B

Gentherm in Novi and Modine in Wisconsin have agreed to merge the latter’s performance technology business — Modine Performance Technologies — into Gentherm. The transaction is valued at approximately $1 billion.

The merger will establish Gentherm as a leader in thermal management solutions and expand its technologies and capabilities in precision flow management, according to company officials.

The move is expected to enable the combined company to serve “attractive” end markets, including power generation; commercial, heavy-duty, and light vehicle; and medical. The combined company expects to realize significant value creation through cost synergies and incremental commercial opportunities including cross-selling, product integration, and entering new global markets.

On a pro forma basis, the combined company had revenue of $2.6 billion, with an adjusted EBITDA margin of 13 percent on a synergy-adjusted basis.

“This transaction accelerates the execution of our strategic framework with the combined company increasing its presence across multiple attractive end markets to drive profitable growth,” says Bill Presley, president and CEO of Gentherm.

“Together, we will further scale our thermal management solutions and expand our technologies and capabilities in precision flow management, building on the global leadership of Modine Performance Technologies in the commercial vehicle, heavy-duty equipment, and fast-growing power generation end markets.”

According to Presley, the engineered solutions of Modine Performance Technologies are well aligned to Gentherm’s four core technology platforms – Thermal Management, Air Moving Devices, Pneumatic Solutions, and Valves.

“We expect to create significant cross-selling opportunities and strengthen our ability to meet the rising demand for our combined, mission-critical offerings,” Presley says. “We look forward to bringing together these two highly skilled teams with long histories of innovation, and a shared commitment to quality and a people-first culture.”

Modine will retain its climate solutions businesses, creating a pure-play climate solutions company focused on the high-growth data center and commercial HVAC and refrigeration end markets. Modine is expected to move forward with a streamlined business model and sharpened management focus on product innovation and high-growth, high-return initiatives, including organic and inorganic opportunities.

The transaction provides Modine shareholders ownership in two focused businesses with stronger growth trajectories, enhanced competitive positioning, and greater potential to drive long-term value creation.

“Combining Modine’s Performance Technologies business with Gentherm establishes two stronger, more focused companies, each equipped to serve its end markets more effectively, accelerate growth, and drive long-term value for shareholders, customers, and employees,” says Neil Brinker, president and CEO of Modine.