Hitachi Rail Enters Agreement to Acquire Thales’ Ground Transportation Systems Business

Hitachi, Ltd. and Hitachi Rail agreed to acquire Thales’ Ground Transportation Systems (GTS) business for an enterprise value of €1,660m. The final purchase price will be determined after customary adjustments typical for a transaction of this nature. The acquisition is expected to close in late FY2022, subject to the usual conditions including regulatory and antitrust clearances. GTS, a division of Thales, is a global leader in Rail Signaling and Train Control Systems, Telecommunications and Supervision systems, and Fare collection solutions. In FY2020, GTS generated €1.6bn of revenues and today employs around 9,000 employees across 42 countries and is headquartered in Germany, France and Canada. Hitachi Rail expects GTS to show continued revenue and EBIT growth and by closing, the implied standalone forward EV/EBIT valuation multiple should be around 10x.