US private equity fund in $7bn deal to acquire Tenneco

Lake Forest, Illinois – Automotive parts and systems maker Tenneco Inc. has entered into a definitive agreement to be acquired by US-based private equity firm Apollo Global Management.

The all-cash transaction has an enterprise valuation of $7.1 billion (€6.31 billion), including debt, and is set for completion in the second half of 2022, Tenneco announced 23 Feb.

The two sides have agreed on a purchase price of $20.00 per share, representing a 100.4% premium over Tenneco’s closing share price of $9.98 on 22 Feb.

Upon completion, Tenneco's shares will no longer trade on the New York Stock Exchange, and Tenneco will become a private company.

The company, which manufactures an array of automotive solutions, including antivibration parts, will continue to operate under the Tenneco name and brand.

"We believe [the deal] will deliver immediate and certain cash value to Tenneco shareholders at a substantial premium," said Dennis Letham, chairman of the board of Tenneco.

The transaction, according to CEO Brian Kesseler, marks “a significant milestone” for Tenneco and will provide the company with a new platform to continue its global strategy in the mobility segment.

"In Apollo, we have a partner that recognises the strength of our product portfolio and our ability to serve leading OEM and aftermarket blue-chip customers globally,” he said.

Specifically, Kesseler expects the partnership to enable Tenneco to grow global footprint.