Linamar to acquire GF’s Leipzig casting facility for €45 million

GUELPH, Ontario - Linamar Corporation (TSX:LNR), which maintains a "GREAT" financial health score according to InvestingPro analysis, announced Tuesday it has entered into a definitive agreement to acquire George Fischer’s Leipzig Casting Facility for €45 million. The company’s stock has shown remarkable strength, gaining 61% over the past six months and currently trading near its 52-week high.

The acquisition will expand Linamar’s casting capabilities to include large ductile iron castings for heavy industrial on and off-highway applications. With a comfortable current ratio of 1.8 and moderate debt levels, the company appears well-positioned to integrate this strategic acquisition. The Leipzig facility is known for its technical capabilities in ductile iron castings and houses what is described as Europe’s largest molding box for machine-molded iron castings. For detailed analysis of Linamar’s acquisition strategy and financial metrics, investors can access comprehensive research reports on InvestingPro.

The facility offers comprehensive services from prototyping and 3D-printing to series production and machining of components. It supplies parts to various markets including on-highway trucks, construction, forestry, and agricultural sectors. Based on InvestingPro’s Fair Value analysis, Linamar’s stock currently appears undervalued, suggesting potential upside from this strategic expansion.

"The completion of the Leipzig facility acquisition provides excellent technology in large ductile iron castings to help Linamar build up our on and off highway commercial vehicle business," said Linda Hasenfratz, Linamar’s Executive Chair. The company’s solid financial foundation, evidenced by its strong cash flow yield and maintained dividend payments for 31 consecutive years, supports this strategic move.

Linamar CEO Jim Jarrell noted that the acquisition is expected to be immediately accretive and will drive both revenue and income growth. The facility’s proximity to Linamar’s existing European operations was also cited as a strategic advantage.

National Bank Capital Markets acted as financial advisor to Linamar on the transaction.

Linamar Corporation is a diversified manufacturing company with operations in 19 countries, employing over 34,000 people across 75 manufacturing locations. The company reported sales exceeding $10.5 billion in 2024, according to the press release statement.

In other recent news, Linamar Corporation reported its second-quarter 2025 earnings, surpassing expectations with an earnings per share (EPS) of $2.81, compared to the forecasted $2.76. The company’s revenue reached $2.6 billion, which represents a 7% decline from the previous year. Despite the decrease in revenue, the better-than-expected earnings indicate a positive performance. Analysts have noted Linamar’s resilience and strategic initiatives in navigating a challenging market environment. This development has caught the attention of investors, contributing to positive sentiment around the company’s recent performance. There were no reports of mergers or acquisitions, nor were there any analyst upgrades or downgrades mentioned in the recent news. Linamar’s ability to exceed earnings expectations is a focal point for stakeholders evaluating the company’s current position and future prospects. These recent developments highlight Linamar’s efforts to maintain stability amidst fluctuating market conditions.

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