Borgers sold -- no jobs will be lost
Jan. 10—NORWALK — Borgers has been sold.
The auto parts supplier in Norwalk was sold to Autoneum, headquartered in Winterhur, Switzerland.
Most importantly, company officials say no workers will be laid off. In fact, the company is hiring.
Borgers employed 265 people when it opened in April 2021 and presently employs 457 people and is one of the largest employers in Norwalk.
"The people factor is very important right now in the U.S.," said Harpak Mozaffari, president and CEO of Borgers. "We have grown to one of the bigger (employers). If you turn (out) to be a bad place to work it is impossible."
"We made some good movements last year ... we are not the best but we are good at $18 (per hour). We try to take care of people. That is important. People need to understand there is somebody taking care of them.
"We try to really keep an eye on our people."
Mozaffari said the workforce will stabilize at just over 400 people. He said the company — like many others — has trouble keeping its workers. He said on any given day 10 to 15 people just won't show up to work.
"We need to stabilize our retention," he said.
The company currently uses a four-shift, 12-hour model going 6 a.m. to 6 p.m. then 6 p.m. to 6 a.m.
That will change back to a three-shift model on Jan 30 going from 6 a.m. to 2 p.m., 2-10 p.m. and 10 p.m. to 6 a.m.
Mozaffari said employees complained when the company went to the 12-hour shifts, and now some are complaining with the shift back to eight-hour days.
"It's hard keeping everybody happy," he said, with a laugh.
Autoneum signed an agreement Jan. 6 to acquire the automotive business of Borgers. The transaction is expected to close in April 2023 following antitrust clearance.
Borgers specializes in textile acoustics protection, insulation and trim for automobiles. The product and customer range of Borgers is to a great extent complementary to the product and customer portfolio of Autoneum. Borgers' wheel arch liner and trunk liner product lines as well as their truck business optimally complement the product range of Autoneum. Especially in the field of textile wheel arch liners, Borgers is the market leader in Europe. In addition, Borgers' product range is distinguished by sustainable and fully recyclable products.
Autoneum is acquiring Borgers from insolvency and has agreed new pricing and delivery terms with its customers. These will ensure sustained profitability and the further development of product and process technologies in both the short and long term.
Matthias Holzammer, Chief Executive Officer of Autoneum, said: "The acquisition of Borgers is based on a sound and convincing industrial logic. The technologies and product portfolios of the two companies complement each other ideally. At its headquarters in Bocholt, Germany, Borgers has a high level of competence in the field of materials and product development with a technical center as well as highly qualified and committed employees.
"For this reason, we intend to integrate Borgers into our existing global product development and customer strategy. We consider the Bocholt location as a technical center of competence for the product solutions wheel arch liners, trunk systems as well as for product and process development of textile carrier materials based on needlepunch technology. Ensuring a high-quality supply of the relevant components to customers is a top priority, both in the short and long term."
Hans-Peter Schwald, Chairman of the Board of Autoneum Holding Ltd, added: "With the acquisition of Borgers, Autoneum is further extending its global market leadership in sustainable and lightweight acoustic and thermal management solutions for vehicles. This is an important strategic step in the development of Autoneum."
The enterprise value paid amounts to 117 million euros — which is about $124,265,700. The transaction will initially be financed through a new credit facility which is available in addition to the syndicated loan of CHF 350 million renewed in October 2022. A capital increase in the amount of approximately 100 million in Swiss Franc is planned for the long-term refinancing of the acquisition. Autoneum's two largest shareholders, Artemis Beteiligungen I AG and PCS Holding AG, have agreed to participate in the capital increase in proportion to their current shareholdings. Even taking into account the aforementioned capital increase, the transaction will generate a positive earnings per share contribution from the outset.
In fiscal year 2021, the Borgers Automotive Group generated revenue of 610 million euros ($642,330,000) with about 4,700 employees. Thanks to Autoneum's global presence, the Borgers product portfolio adds to the sales potential for profitable growth in the medium term outside Europe.
