Gentherm (THRM) investor relations material

Deal rationale and strategic fit

• The merger nearly doubles revenue to $2.6 billion, accelerates strategic growth in thermal management, and expands into commercial vehicle, heavy-duty equipment, and power generation markets.

• Expands product portfolio and engineering capabilities, enhancing access to new global markets and customer bases.

• Diversifies revenue mix, reducing reliance on light vehicles and increasing exposure to commercial, heavy-duty, and power generation markets.

• Leverages both companies' technical expertise, patent portfolios, and established customer relationships for innovation and market leadership.

• Builds on shared cultures of operational excellence and process orientation.

Financial terms and conditions

• The transaction is structured as a Reverse Morris Trust valued at approximately $1 billion, intended to be tax-free for Modine and its shareholders.

• Valued at a 6.8x multiple on $147 million pro forma synergy Adjusted EBITDA for the trailing 12 months ended September 2025.

• Modine shareholders will receive a $210 million cash distribution and about 21 million shares of newly issued stock, equating to $790 million in equity consideration.

• Ownership split will be 60% for Gentherm shareholders and 40% for Modine shareholders.

• Pro forma net leverage expected at approximately 1.0x, maintaining strong balance sheet and capital flexibility.

Synergies and expected cost savings

• Identified $25 million in annual run-rate cost synergies by end of 2028, mainly from cost optimization and operational efficiencies.

• Additional value expected from cross-selling, product integration, and entry into new global markets.

• Clear path to mid-teens adjusted EBITDA margin for the combined company.

• Commercial synergies pipeline identified actionable revenue opportunities exceeding $100 million.