SIEMENS AUTOMOTIVE and BREED Technologies to Form Strategic Alliance and Joint Ventures
15 October 1997
SIEMENS AUTOMOTIVE and BREED Technologies Agree to Form Global Occupant Safety Strategic Alliance and Joint Ventures
LAKELAND, Fla., and REGENSBURG, Germany, Oct. 15 -- Global
automotive suppliers BREED Technologies, Inc. (BREED), with its headquarters
in Lakeland, Fla., and Siemens Aktiengesellschaft (AG), Automotive
Systems Group (SIEMENS AUTOMOTIVE), with its headquarters in Regensburg,
Germany, jointly announced today that they have signed a Memorandum of
Understanding (MOU) to form a global strategic alliance for the worldwide
research, development, engineering, assembly and marketing of motor vehicle
occupant safety restraint systems. Under the alliance, the companies will
combine resources to establish a joint venture as a holding company in Germany
with subsidiaries in Germany and North America.
BREED Technologies is a global tier-one supplier of fully integrated
automotive occupant safety systems and is the world's largest producer of
steering wheels. With its announced acquisition of AlliedSignal Safety
Restraints, BREED becomes the seat belt market leader in North America.
SIEMENS AUTOMOTIVE is the world's leading independent tier-one supplier of
single-point air bag electronic control units. Siemens also is among the
leading companies developing advanced sensors and electronic controls for
future adaptive restraint and occupant protection systems.
The agreement, signed by representatives of both companies on October 14,
1997, also calls for Siemens to invest in newly issued shares of BREED
Technologies stock. This purchase represents approximately 10 percent of the
outstanding, fully diluted shares of the company. BREED will apply SIEMENS
AUTOMOTIVE's investment toward the cost of acquiring AlliedSignal's Safety
Restraint systems division and as working capital.
This strategic partnership will offer customers BREED's state-of-the-art
occupant safety system technologies and components combined with SIEMENS
AUTOMOTIVE's advanced sensors and occupant safety electronics in an integrated
package. To meet increasing customer requirements for integrated occupant
safety systems solutions, the alliance will leverage the partners'
complementary areas of technological and systems integration expertise.
SIEMENS AUTOMOTIVE commits its entire safety systems operation to the
strategic alliance, and will provide electronics and advanced technology
support to BREED's development of occupant safety systems, including crash
sensors; driver, passenger and side-impact air bag modules; azide, non-azide
and hybrid inflators; safety belts and steering wheels. In addition, both
companies will benefit from the vast resources and electronics expertise of
Siemens AG, the world's second largest electronics capital goods manufacturer.
Activities in Europe and North America
As part of this strategic alliance, SIEMENS AUTOMOTIVE will contribute its
shares in the existing Passive Restraints Systems (PARS) GmbH, Alzenau,
Germany to the Joint Venture. PARS is one of Europe's most advanced crash
test facilities and occupant safety system development centers. It will serve
as a center for the design, engineering, simulation, testing and sales of
BREED-SIEMENS AUTOMOTIVE integrated occupant safety systems in Europe. PARS
will continue to provide crash test services to automakers and suppliers.
BREED will form a company with its headquarters and facilities located in
Michigan and will contribute various assets to it. In the Joint Venture this
company will perform in North America the same tasks as PARS.
The partners believe that arrangements for this venture will be completed
during the current fiscal quarter. SIEMENS AUTOMOTIVE and BREED also are
exploring future collaborative opportunities to serve customers in Latin
America and the Asia Pacific region.
"The future of occupant safety systems in vehicles will be defined,
largely, by technological advancements and systems capabilities that very few
companies can provide," said Dr. Franz Wressnigg, Chairman of SIEMENS
AUTOMOTIVE. "When we analyzed the global strengths, complementary product mix
and safety systems expertise of SIEMENS AUTOMOTIVE and BREED Technologies, it
was clear that, combined, we could form just such a company."
"This alliance provides BREED with significant growth opportunities,
access to new markets and technologies, and the ideal partner for the
development of advanced vehicle safety systems for our customers," said
Johnnie Cordell Breed, Co-Chairman and Chief Executive Officer of BREED
Technologies. "Our new partnership with SIEMENS AUTOMOTIVE, along with our
recently announced acquisition of AlliedSignal's automotive safety restraints
group, demonstrates our commitment to strengthening our market position in all
areas of automotive safety. SIEMENS AUTOMOTIVE's strategy is to have a
systems partner. Our strategy is to have an electronics partner. It's a
perfect match. Together, we make a formidable competitive team for integrated
automotive occupant safety systems."
The strategic alliance, joint ventures and stock purchase were approved by
the boards of both companies. However, merger approval is still required from
antitrust authorities in the US and the European Communities.
Headquartered in Lakeland, Florida, USA, BREED Technologies is one of the
world's leading suppliers of automotive occupant safety systems and steering
wheels, providing its global automotive customers with research and
development, engineering and manufacturing support through its global network
of facilities in 13 countries. BREED employs 11,366 people at 57 facilities
worldwide. Information about BREED and its products is available on the
Internet at http://www.breedtech.com .
As a business unit of Siemens AG, with its registered seats in Berlin and
Munich, Germany, SIEMENS AUTOMOTIVE is an independent first-tier supplier of
advanced electrical/electronic systems and components for the global
automotive industry. Since 1981, SIEMENS AUTOMOTIVE has pioneered numerous
innovative solutions in all fields of automotive electronics. These solutions
include safety systems with single-point crash sensing; pressure and
accelerometer-based sensing for side air bag systems and the first child seat
detection product, called BabySmart(R). The company supplies 29 of the
world's top 30 auto makers from approximately 70 facilities located on four
continents. SIEMENS AUTOMOTIVE generated sales of $2.7 billion in 1996,
representing a 50 percent increase over the two previous years. Additional
information and artwork on SIEMENS AUTOMOTIVE can be found on the Internet at:
http://www.siemensauto.com .
SOURCE Siemens Automotive