TI Fluid Systems is poised to exit the London Stock Exchange, contributing to a total of over £50 billion in stock market exits this year.

The FTSE 250 engineering company has advised its shareholders to support a £1 billion acquisition by Canadian firm ABC Technologies, which is financed by Apollo Global Management.

This acquisition pushes the total value of companies departing from the London market to approximately £52 billion in 2023, according to analysis conducted by investment bank Peel Hunt.

Established in 2017 with an initial share price of 255p per share by Bank Capital, TI Fluid Systems specializes in the manufacturing of fluid-carrying systems for vehicles. The board has approved the 200p per share proposal from ABC Technologies, marking a significant 47.3 percent premium over its last closing price on September 12, the day before ABC’s interest became public.

Terry Campbell, the president and CEO of ABC Technologies, stated: “This transaction represents a transformative strategic opportunity that unlocks value for our stakeholders and lays the groundwork for future growth.”

The recent weeks have seen a surge in takeover activity in the City, with companies such as TT Electronics, Aquis, Centamin, Renewi, Loungers, and Direct Line also receiving acquisition bids. This uptick in acquisitions follows a prolonged period of dormancy in the market, as rising interest rates stifled deal-making.

Analysts have cautioned that revenue streams for TI Fluid Systems could face challenges due to issues with Stellantis, its largest client in the US. They noted that shareholders might find a beneficial opportunity to realize value through ABC’s proposal. Following this news, TI Fluid Systems’ shares increased by 1.6 percent, or 3p, finishing at 192p.

Tim Cobbold, chairman of TI Fluid Systems, remarked: “TI Fluid Systems is a prominent market leader, known for its talented workforce, innovative products, esteemed customer relationships, and strong growth prospects.”

He further emphasized, “The board believes this offer provides an attractive premium and assures shareholders of a cash consideration that mirrors TI Fluid Systems’ inherent strengths and potential while addressing the broader uncertainties within the industry.”