3i Acquires Hilite International

3i Group will buy Cleveland, Ohio-based Hilite International, a maker of fuel-efficient auto parts, for an undisclosed amount, Reuters reported. The deal reportedly valued Hilite at about $300 million, Reuters said.

(Reuters) – Private equity firm 3i Group (III.L) said it has agreed a deal to acquire Hilite International, a maker of fuel-efficient auto parts, moving into a fast growing segment of the automotive market.

British listed 3i did not disclose the terms of the deal but a source familiar with the situation said the deal valued Hilite, whose customers include leading vehicle makers General Motors (GM.N), Chrysler [CCMLPD.UL] and BMW (BMWG.DE), at about $300 million.

Cleveland, Ohio-based Hilite brought in Lazard (LAZ.N) to find a buyer for the business, after emerging from bankruptcy a year earlier in the hands of its creditors, Reuters reported in December.

The company was expected to fetch between $300 million and $350 million — or six to seven times earnings before interest, tax, depreciation and amortisation of $50 million — and draw interest from major auto parts suppliers, as well as private equity firms, a source said at the time.

The deal marks a rare acquisition for 3i of a North America head-quartered company, though the firm has extensive experience with businesses supplying the automotive industry, including recently listed Norma (NOEJ.DE) and MWM, which it sold to Caterpillar (CAT.N) last year.

Hilite operates in a high-growth area of the global automotive market, making hydraulic actuators and timing systems which improve fuel consumption and reduce emissions.

It has six plants across North America, Europe and Asia and generated revenues of $400 million in 2010. (Reporting by Simon Meads; Editing by Louise Heavens)