Wabtec has announced that it has entered into a definitive agreement to acquire Frauscher Sensor Technology Group, a leader in train detection, wayside object control solutions, and axle counting systems. This acquisition will drive accelerated and profitable growth for Wabtec, while also enhancing the company’s Digital Intelligence business by integrating complementary railway signaling technologies.
Wabtec is buying Frauscher for an enterprise value of €675 million in cash. The deal is anticipated to deliver immediate shareholder value, featuring an accretive growth profile, accretive Adjusted EBIT margins, accretive Adjusted EPS in the first year of ownership, and an accretive return on invested capital (ROIC) over time.
The purchase price reflects an estimated multiple of 12.4 times projected 2025 EBITDA, adjusted for projected run-rate cost synergies, which Wabtec expects to be realized over a three-year period. Frauscher is expected to generate approximately €145 million of revenue in 2025, and the expected growth will exceed Wabtec’s average growth over the next five years.
KEY QUOTES:
“This strategic acquisition enhances Wabtec’s current Digital Intelligence portfolio, our opportunities in a high-potential market, and aligns with our company’s long-term growth strategy. Frauscher has an industry leading portfolio that offers a rare combination of innovative technology, sustained growth, and strong and resilient profitability.”
Wabtec President and CEO Rafael Santana
“Frauscher is a strong addition to the Digital Intelligence business, with a complementary product portfolio that supports our vision of maximizing the safety, efficiency, and capacity of the global rail network. By combining our businesses, we will be able to deliver safety-critical insights through customized systems combining sensors with software and analytics, along with a comprehensive lifecycle services suite. Given Frauscher’s significant presence in Europe and India, this acquisition will further strengthen our international growth strategy in these large markets.”
Nalin Jain, President of Wabtec’s Digital Intelligence Group
