* To buy Schrader from private equity firm Madison Dearborn
* To benefit from Europe's tire pressure monitoring mandate
* Expects deal to add 18-21 cents/share to 2015 earnings
* Shares up as much as 6.6 pct
(Adds comments from conference call, analyst comment, share
Aug 18 Sensors and electrical controls maker
Sensata Technologies Holding NV said it would buy
Schrader International to meet growing demand for sensors to
monitor car-tire pressure.
Sensata, whose shares rose as much as 6.6 percent on Monday
morning, will purchase Schrader from private equity firm Madison
Dearborn Partners LLC for an enterprise value of $1 billion.
Denver-headquartered Schrader makes tire-pressure monitoring
sensors (TPMS) that alert drivers when a tire is under-inflated.
The technology, fitted on all cars in North America, is
being rolled out in Europe to meet a new regulation that
requires all passenger vehicles to have it installed this year,
the company said.
Similar regulations are expected in China in the next four
to five years, Chief Executive Martha Sullivan said on a
"(The deal) would be a good earnings driver next year,"
Cross Research analyst Steven Fox said.
Netherlands-based Sensata said it expects the deal to add
18-21 cents per share to earnings in 2015. It also expects to
add another 18-22 cents per share to earnings when China adopts
China represents an extremely large growth opportunity for
TPMS, Steve Beringhause, head of Sensata's global sensors
"With over 23 million light vehicles expected to be built
there this year ... with four (tires) per vehicle that is nearly
a 100 million sensor opportunity."
In South Korea the mandate begins next year, he said.
Schrader, which has about half of the TPMS market share in
North America, also sells in the United Kingdom, Germany, China,
Japan and South Korea. It is expected to generate $550 million
in revenue this year, Sensata said.
The company expects the deal to hit earnings by 13-16 cents
per share this year. It had forecast full-year adjusted earnings
of $2.39-$2.45 per share in July.
Barclays Bank Plc and Morgan Stanley Senior Funding Inc have
committed to finance the deal, expected to close in the fourth
Centerview Partners advised Sensata, while Barclays,
Citigroup and Guggenheim Securities advised Schrader.
Sensata shares were up 6.3 percent at $49.08, after touching
a high of $48.57, on the New York Stock Exchange on Monday
(Reporting by Mridhula Raghavan in Bangalore; Editing by