Gentherm Inc. (NASDAQ: THRM) and Modine Manufacturing Company (NYSE: MOD) have entered into a definitive agreement to merge Modine’s Performance Technologies business into Gentherm through a tax‑free Reverse Morris Trust transaction valued at approximately $1 billion. The deal will create a single, combined entity that will continue to operate under the Gentherm name and ticker THRM.
Under the structure, Modine will spin off its Performance Technologies division—an $1.1 billion revenue, $123 million EBITDA business—into a new entity (SpinCo). Modine shareholders will receive about 21 million shares of Gentherm common stock, giving them roughly 40 % ownership of the combined company, while Gentherm shareholders will own the remaining 60 %. The pro‑forma revenue of the combined company is projected to be $2.6 billion, with an adjusted EBITDA margin of 13 % after realizing $25 million in annual cost synergies.
Gentherm’s management highlighted that the transaction broadens the company’s footprint beyond its traditional automotive focus into commercial, heavy‑duty, power‑generation, and medical markets. By adding Modine’s precision flow‑management technology, Gentherm will strengthen its thermal‑management platform and accelerate cross‑selling opportunities across its four core technology areas. Bill Presley, President and CEO of Gentherm, said the merger “accelerates the execution of our strategic framework, expanding our presence across multiple attractive end markets to drive profitable growth.”
For Modine, the deal allows the company to concentrate on its high‑growth Climate Solutions business, which generated $1.6 billion in revenue for the twelve months ended September 2025 and a 19.6 % adjusted EBITDA margin. The transaction also provides Modine with a $210 million cash distribution from the spun‑off entity and positions the company as a pure‑play climate‑solutions provider focused on data‑center cooling and commercial HVAC. Neil Brinker, President and CEO of Modine, noted that the merger “creates two stronger, more focused companies, each equipped to serve its end markets more effectively and accelerate growth.”
The combined company will be headquartered in Novi, Michigan, and is expected to close in the fourth quarter of 2026, subject to customary regulatory approvals and shareholder consent. Leadership of the new entity will include Bill Presley as CEO and Jon Douyard as CFO, both of whom will continue in their current roles after the transaction.
The transaction is structured to be tax‑free for Modine and its shareholders, a common feature of Reverse Morris Trust deals that allows the spin‑off to avoid corporate tax liabilities while enabling the merger to proceed efficiently.
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