DETROIT, Mich.–ZF Friedrichshaven’s proposed acquisition of WABCO (NYSE: WBC) for $7 billion highlights the importance of brake system tech companies in automakers’ pursuit of superior autonomous driving technology.

The all-cash deal announced yesterday by the companies is for $136.50 per share, and represents a 13% markup from Feb 26 when the companies disclosed they were exploring a tie-up, but a 6.5% discount to where the stock closed Wednesday.

The two companies said on Thursday that the deal, which is expected to close in early 2020, had been unanimously approved by Wabco’s board of directors. The deal is contingent on ZF clinching more than 50 percent of Wabco’s shares.

But the deal could face hurdles. Shares of WABCO tumbled 10% in pre-market trading Thursday after the deal was announced, to well below ZF’s asking price.

The stock closed Wednesday at $146.01, up from $120.75 in late February before word of potential takeover first surfaced. 

Almost immediately after the news of the deal broke, shareholder rights law firm Johnson Fistel, LLP said it launched an investigation into whether the board members of WABCO Holdings Inc. “breached their fiduciary duties in connection with the proposed sale of the Company to ZF Friedrichshafen AG (“ZF”).”

WABCO management perhaps forecasted a shareholder suit over the deal. Just days before Wabco Holdings announced a deal to be acquired by Germany’s ZF Friedrichshafen, its board approved a bylaw change designating the Delaware Court of Chancery as the exclusive forum for most shareholder lawsuits. The Delaware Chancery Court, one of the country’s most influential business courts, doesn’t use juries and is regarded as relatively business-friendly compared with other courts.

Some 99% of WABCO shares are held by institutions. The company has been paying no dividend. Given the reaction to the deal price, the market may think there are other potential suitors, or that the company is not being fairly valued.

ZF, a leading supplier of gearboxes and hybrid-vehicle components, has been looking to beef up its brake system capabilities.

“The combination of both businesses is expected to further accelerate the development of new technologies to enable autonomous commercial vehicle functions, making ZF less dependent on the economic cycle of the passenger car industry,” ZF said in a statement.

ZF purchased TRW Automotive, a major supplier, in 2014.