Dürr is selling 85% of the shares in the Dürr Ecoclean Group to Chinese engineering and machinery company Shenyang Blue Silver Group (SBS Group). With annual sales of around € 200 million, the Dürr Ecoclean Group is the global market leader in cleaning and surface processing systems for industrial parts. The SBS Group is expected to acquire the shares at the end of 2016 subject to approval by the authorities. The purchase price will be based on Dürr Ecoclean´s enterprise value of around € 120 million. The SBS Group has committed to continue investing to develop Dürr Ecoclean and its business. Moreover, it has undertaken to maintain Dürr Ecoclean’s sites and employment contracts in Germany until the end of 2019.
The SBS Group is based in the North Eastern Chinese industrial city of Shenyang. In 2015, the group generated sales revenues of around € 200 million with around 700 employees. The SBS Group subsidiary Shenyang Blue Silver Industry Automation Equipment Co., Ltd. will be executing the purchase of Dürr Ecoclean. Shenyang Blue Silver Industry Automation Equipment Co., Ltd is listed on the Shenzhen stock exchange
Via Dürr Ecoclean, the SBS Group particularly wants to expand its business in the automotive industry, where it operates a joint venture with German company DVS Technology Group (Frankfurt) which supplies tooling machines for transmission production among other things. Dürr Ecoclean cleaning machinery is also used in automotive engine and transmission production lines, accounting for around two thirds of its sales revenues.
In April 2016, Dürr had announced that it is conducting a strategic review of the Ecoclean activities. Dürr Ecoclean operates in a growing but fragmented market characterized by a large number of competitors. As the new majority owner, the SBS Group wants to invest in Dürr Ecoclean’s expansion. Hongsheng Guo, founder and majority shareholder of the SBS Group: “Dürr Ecoclean enjoys an excellent market position through its technology leadership and competent and motivated workforce. Acquiring the majority of Dürr Ecoclean will allow us to accelerate our international expansion in the automotive sector. The management of Dürr Ecoclean has identified a number of growth opportunities for the business and, together with our existing activities we will be further developing the business potential for Ecoclean in China.”
Ralf W. Dieter, CEO of Dürr AG: “Over the last few years, we have realigned Dürr Ecoclean and achieved a sustained turnaround in earnings. We are pleased to have found in SBS Group an ideal strategic partner for Ecoclean. The SBS Group has a clear strategic focus on machinery for processing parts in engine and transmission production and will be gaining in Ecoclean a company that is well positioned in this area.”
Dürr Ecoclean has around 850 employees at ten sites in eight countries. The majority of the workforce – around 450 employees – are based at the German facilities in Filderstadt and Monschau. Dürr will be retaining a minority 15% interest in Dürr Ecoclean.
Net of transaction and carve-out costs, Dürr expects a book profit in the low double-digit million euro range. The exact amount cannot yet be calculated as the cost of carving out and transferring Dürr Ecoclean has not yet been determined conclusively. Similarly, the closing date and the date on which the book profit will be recognized have not yet been finalized, this primarily being contingent on the receipt of government approvals.
Source: automotiveworld.com
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