Strategic Rationale : Why This Deal Makes Sense

Wiring harnesses sit at the heart of a modern vehicle’s electrical architecture, and their importance is rising rapidly as automobiles transition from mechanical machines to software-driven, electrified platforms.

For Motherson, this acquisition is not an adjacent bet - it strengthens a core vertical.

Key Strategic Drivers

• Electrification Tailwind: EVs require significantly more wiring content than ICE vehicles due to battery management systems, power electronics, sensors, and connectivity modules.

• Complexity Premium: Advanced driver assistance systems (ADAS), infotainment, and vehicle connectivity are driving higher-value, more complex harness designs.

• OEM Lock-in: Wiring harnesses are deeply integrated into vehicle platforms, creating long-term customer stickiness and recurring revenue visibility.

Nexans Auto Electric’s wiring harness business fits seamlessly into Motherson’s existing electrical distribution and wiring systems portfolio, enhancing both scale and technical depth.

About the Target : Nexans Auto Electric – Wiring Harness Unit

The acquired business focuses on:

• Design, development, and manufacturing of automotive wiring harness solutions

• Serving global OEMs across:

  • Internal combustion vehicles

  • Hybrid platforms

  • Battery electric vehicles (BEVs)

Strategic Assets Brought In

• Established engineering and design capabilities

• Skilled manpower with domain-specific expertise

• Long-standing OEM relationships and platform-level contracts

• Strong European footprint, adding regional balance to Motherson’s global operations

This makes the business a plug-and-play asset rather than a turnaround story.

Deal Structure & Financial Perspective

• Motherson will acquire 100% ownership of the wiring harness business.

• The €207 million enterprise value will be adjusted for standard closing items such as net debt and working capital.

• The transaction follows Motherson’s familiar bolt-on acquisition playbook, limiting balance-sheet stress while enhancing return on capital over time.

Historically, Motherson has demonstrated an ability to integrate acquired assets efficiently, extract cost synergies, and improve margins through scale and operational discipline.

Competitive Landscape Impact

Post-acquisition, Motherson:

• Further consolidates its position among the world’s leading automotive wiring harness suppliers

• Enhances competitiveness against global peers by:

  • Expanding geographic reach

  • Improving cost efficiencies

  • Strengthening customer concentration with European OEMs

With global demand shifting toward high-voltage wiring systems and intelligent power distribution, scale and engineering depth are becoming decisive advantages—both of which this deal reinforces.

Market Context & Investor Lens

The transaction reflects two broader industry trends:

1. Portfolio rationalisation by global auto component suppliers, exiting non-core or lower-growth segments.

2. Future-proofing by Tier-1 suppliers through investments in electrification-linked components.

From an investor perspective:

• Such acquisitions are generally viewed as medium- to long-term value accretive, provided integration risks are well-managed.

• The deal aligns with Motherson’s long-standing strategy of building non-cyclical, technology-intensive businesses rather than chasing volume-driven growth alone.

Why This Acquisition Matters Strategically

• Wiring harnesses are evolving from low-margin components to high-value system enablers.

• Control over this segment enhances OEM integration, platform longevity, and pricing power.

• The acquisition strengthens Motherson’s relevance in a future where software, electronics, and electrification dominate vehicle design.

Final Take

The €207 million acquisition of Nexans Auto Electric’s wiring harness business is a strategically coherent and forward-looking move by Samvardhana Motherson International. It deepens the company’s presence in a structurally growing segment, enhances global scale -particularly in Europe - and aligns squarely with long-term automotive megatrends.

Execution and integration will remain key in the near term, but strategically, this deal reinforces Motherson’s position as a future-ready global automotive supplier in an industry undergoing fundamental transformation.

Sources

Company disclosures, exchange filings, and global M&A reports