Core Viewpoint - German automotive and industrial supplier Norma is selling its water management business to U.S. rival Advanced Drainage Systems for $1 billion, which will significantly impact its revenue and strategic focus [1][2]. Group 1: Deal Details - The sale is valued at $1 billion and is expected to close in the first quarter of 2026 [1][3]. - Norma anticipates a net cash inflow of approximately 620 million to 640 million euros ($731 million to $755 million) from the transaction [2][3]. - The company plans to allocate 300 million euros of the proceeds to repay debt and reserve up to 70 million euros for potential acquisitions in the industrial applications sector [3]. Group 2: Financial Impact - Following the announcement, shares in Norma initially rose by 4% but later fell by 3.8% [2]. - The company expects to lose about 25% of its forecast revenue for the year due to the sale, revising its full-year sales guidance to a range of 810 million to 830 million euros, down from a previous estimate of 1.1 billion to 1.2 billion euros [4]. - The adjusted EBIT margin forecast from continuing operations has been lowered to no more than around 1%, down from a previous forecast of 6%-8% [5]. Group 3: Strategic Focus - The management board intends to return the remaining portion of the net cash inflow to shareholders, potentially through a share buyback program [3]. - The water management business, which generated 90% of its revenue from the U.S. agricultural sector, will be removed from financial reporting starting in October [2][4].