Energy administration firm Eaton Corp. stated Tuesday that it finalized a deal to accumulate Royal Energy Options for $600 million in a bid to increase its electrical automobile provide chain enterprise.

Royal Energy Options is an electrical connectivity parts firm whose elements are used primarily in EVs. The acquisition will permit Eaton’s eMobility crew to increase its attain into that $11 billion market, stated Joao Faria, president of Eaton’s automobile group unit.

“It is a massive alternative for us after which deliver an even bigger portfolio and an even bigger market that we will attend to,” he stated.

The value paid is greater than 13 instances Royal Energy Options estimated earnings earlier than curiosity in 2022, Eaton stated in a press release.

Royal Energy Options works with lots of similar manufacturing prospects as Eaton, Faria stated.

Royal Energy Options employs about 450 folks and operates two manufacturing services, positioned in Carol Stream, Ailing., and Queretaro, Mexico. The corporate additionally has a gross sales and engineering division positioned close to Detroit in Canton, Mich.

Eaton doesn’t plan to reorganize the corporate however as an alternative will simply look to increase additional into the markets by which Royal Energy Options operates. Eaton will look to make use of its connectivity know-how within the aerospace sector and information facilities as properly, Faria stated.

“The addition of Royal Energy Options enhances our potential to capitalize on this secular development pattern throughout our eMobility, aerospace and electrical companies,” Heath Monesmith, COO of Eaton’s industrial sector unit, stated within the assertion.