Delphi says its US$962m acquisition of FCI Group's Motorised Vehicles Division (MVL) will allow it to use part of its significant cash strength and bolster its presence in the connector sphere.

The deal - still subject to regulatory approval and works council ratification - will see MVL become part of Delphi's Electrical/Electronic Architecture (EEA) segment - a global provider of interconnection systems for use in safety restraint systems, powertrain and electrical vehicles.

"We have always been extremely transparent [what] we would do with the cash this [business] model generates in order to create more value for shareholders," Delphi CEO and president, Rodney O'Neal told just-auto from the supplier's headquarters in Troy, Michigan.

"Our priority in terms of the acquisition would be in the space of electronics or powertrain and put our cash to work. So an acquisition would be strategic and fill gaps - we said an area of interest would be connectors."

"We know FCI and we have looked at it for years - it is a unique asset in the connector space - we have a very strong connector business and this just solidifies and improves customer diversification particularly with customers like Nissan."

MVL had revenue of EUR692m  in the year ended 31 December, 2011 and is owned by affiliates of Bain Capital.

Delphi added the transaction would enhance its portfolio of connectors for hybrid and electric vehicles, while equally diversifying its customer base.

The purchase would also broaden relationships with OEMs says Delphi, such as Chrysler,Daimler, Ford, General Motors, Hyundai, PSA Peugeot Citroën, Renault Nissan and Volkswagen, while its Asian footprint would be strengthened in China, India and South Korea.

Delphi expects synergies of US$80m to be achieved by 2015 from procurement, product development and the supply chain.