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Investing.com -- Shares of Nexans (EPA:NEXS) (EPA:NEX) climbed 1.2% after the company announced it has entered exclusive negotiations to sell its industrial cable division, Lynxeo, to Latour Capital.
The proposed sale for an enterprise value (EV) of €525 million is a strategic move by Nexans to exit the specialty industrial cables business and focus more sharply on its core electrification efforts.
Lynxeo, recognized as a leader in specialty industrial cables, serves a diverse set of industries, including transportation, energy, and automation. With a global manufacturing footprint that spans Europe, Asia, and the United States, Lynxeo employs approximately 2,000 workers and has reported standard sales exceeding €700 million.
The completion of this transaction is contingent upon customary regulatory approvals, with an expected closing in the second half of 2025.
Post-deal, Nexans’ Industry & Solutions segment will primarily consist of the auto-harness business, which generates in excess of €800 million in standard sales. This divestiture marks a significant pivot for Nexans towards becoming a pure-play electrification entity.
Jefferies analysts commented on the significance of the deal, stating: "The deal allows Nexans to continue the transformation into a pure-play electrification player. It also raises about €525m that can be repurposed into acquisitions to further consolidate the low & medium voltage businesses (Connect & Grid).
Closing could take place in H2-2025 and will likely put pressure on mgmt to partly reallocate the capital into M&A during the year."
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