Gentherm (THRM) Acquires Alfmeier’s Automotive Business

Gentherm (NASDAQ: THRM), a global market leader of innovative thermal management technologies, announced today that it has entered into a definitive purchase agreement to acquire the automotive business of Alfmeier Präzision SE (“Alfmeier”).

Alfmeier, headquartered in Treuchtlingen, Germany, is an innovative market leader in automotive lumbar and massage comfort solutions, with deep expertise in advanced valve system technologies, integrated electronics and software. Alfmeier pioneered the use of Shape Memory Alloy (SMA) valve and pump technology for automotive seats, and continues to be an industry leader in innovation with more than 200 patents. Additionally, they are a global leader in high complexity, high reliability valves for automotive fluid systems. With approximately 2,200 employees globally, Alfmeier has operations in Germany, the Czech Republic, the United States, Mexico and China. Alfmeier’s automotive business to be acquired generated €232 million in revenue for 2021.

The acquisition of Alfmeier further expands Gentherm’s value proposition beyond thermal in comfort, health, wellness and energy efficiency. Gentherm is excited to offer more compelling and high-value solutions across complementary customer relationships, leveraging the combined technologies, teams and capabilities. Gentherm also sees an opportunity to integrate the highest performing comfort and wellness solutions in the most space efficient manner, which is particularly important for electric vehicles that demand compact integrated designs. In addition to revenue synergies, the Company expects to achieve approximately $10 million in annual run-rate cost savings.

“Alfmeier’s automotive business is a perfect complement to Gentherm’s existing capabilities and will further drive our mission to improve comfort, health, wellness, and energy efficiency,” said Phil Eyler, Gentherm's President and CEO. “This transaction aligns well with global consumer demand for expanded offerings in vehicle passenger comfort. Combining Alfmeier’s technological advancements in physiotherapy with Gentherm’s expertise in thermophysiology maximizes our capabilities of providing world class comfort and wellness solutions. In addition, Alfmeier’s industry leading expertise in air and liquid flow valve systems should also open additional growth opportunities for Gentherm’s ClimateSenseTM and Battery Performance Solutions. We look forward to welcoming the members of the Alfmeier team to the Gentherm family.”

Andreas Gebhardt, CEO of Alfmeier, said “I am excited to see the combination of two unique system design companies with integrated hardware and intelligent software. Alfmeier, as part of Gentherm, will be able to deliver a superb passenger experience through highly cost-efficient systems at a much larger scale. Automakers around the world will benefit from the innovative culture of both companies with integrated market-leading thermal and physical comfort solutions.”

Under the terms of the transaction, Gentherm will acquire Alfmeier for €177.5 million in cash, subject to adjustments as set forth in the purchase agreement. The transaction will be funded through a combination of Gentherm’s existing cash balances and revolving credit facility. The transaction, subject to regulatory approvals and other customary closing conditions, is expected to close during the third quarter of 2022.

Guggenheim Securities, LLC is serving as the financial advisor to Gentherm. Honigman LLP and Gleiss Lutz are acting as legal counsel to Gentherm.

Conference Call

Management will discuss this acquisition on its previously-announced First Quarter earnings results conference call today at 8:00 am Eastern Time. The dial-in number for the call is 1-877-407-4018 (callers in the U.S.) or +1-201-689-8471 (callers outside this U.S.). The passcode for the live call is 13728996.

A live webcast and one-year archived replay of the call can be accessed on the Events page of the Investor section of Gentherm's website at www.gentherm.com.

A telephonic replay will be available approximately two hours after the call until 11:59 pm Eastern Time on May 18, 2022. The replay can be accessed by dialing 1-844-512-2921 (callers in the U.S.), or +1-412-317-6671 (callers outside the U.S.). The passcode for the replay is 13728996.

Investor Relations ContactYijing Brentano[email protected](248) 308-1702

Media ContactMelissa Fischer[email protected](248) 289-9702

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