self-driving cars must navigate rapidly changing conditions

Extreme weather, unexpected obstacles: self-driving cars must navigate rapidly changing conditions. Investors in Osram, which makes sensors for autonomous vehicles, also have to steer round hazards. The latest of these is a bid by Bain Capital and Carlyle, which seeks to profit from a sudden swerve in the automotive industry. US buyout firms have a growing taste for out-of-favour continental businesses. Bain and Carlyle are offering €35 a share for the Munich-based group best known for its lamps, giving an equity value of €3.4 billion… If shareholders believe the automotive industry is entering a dark phase, Bain and Carlyle are paying a fullish price. The enterprise value is about eight times forecast 2020 ebitda, a significant premium to peers. International optoelectronics businesses trade on average multiples of 6.3 times, and auto and speciality lighting 4.4 times. Private equity is flush with funds. Prices for private companies are elevated, so listed groups are preferred… Assume an early rebound in the automotive industry, however, and the offer price looks mean… Autonomous cars provoke growing scepticism. But it is hard to believe demand for Osram’s products is in structural decline. Bain and Carlyle are driven by the cyclicality of their own industry. They need to go up a gear in price.