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Takeover target Veoneer's losses narrow ahead of Qualcomm deal

By Reuters

STOCKHOLM – Swedish automotive technology group Veoneer reported on Tuesday a narrower third-quarter loss amid a global chip shortage and said it would no longer provide an outlook as it focused on its looming merger.

Chipmaker Qualcomm Inc and SSW Partners said this month they had reached an agreement to buy Veoneer for $4.5 billion.

The maker of vision systems, radars and software for advanced driver-assistance systems (ADAS) was hit hard by the outbreak of the pandemic. Demand has since broadly recovered, while the auto industry is facing a shortage of electronic components.

Veoneer, which competes with the likes of Aptiv, Bosch, Continental and Mobileye, said underlying demand for its products remained very strong, while semiconductor shortages and supply chain constraints continued to hamper growth.

“We are managing this situation daily, and are doing our utmost to support our customers through this difficult situation,” Veoneer Chief Executive and Chairman Jan Carlson said in a statement.

Veoneer made an operating loss of $89 million versus a loss of $103 million in the year-ago quarter.

Qualcomm in August offered to buy the Sweden-based firm at an 18.4% premium to a July bid worth around $3.8 billion by Magna that had already been accepted by Veoneer’s board.