10 February 2014 17:30 [Source: ICIS news]
LONDON (ICIS)--German tyre major Continental signed an agreement with private equity firm Carlyle Group to acquire Ohio-based Veyance Technologies for €1.4bn in order to strengthen its technology segment, ContiTech, Continental said on Monday.
The Hanover-based automotive supplier said 90% of Veyance sales in 2013 were achieved outside the automotive industry and it will help compliment its ContiTech segment in order to expand in rubber and plastic technologies.
The German major said the acquisition will enable ContiTech to gain markets where the company’s current presence is limited such the US and South America.
With the acquisition, Continental will gain plants in Mexico, Canada, China, Australia and South Africa.
“Veyance and ContiTech complement each other geographically and ContiTech’s Conveyor Belt Group and Fluid Technology business units in particular will benefit from an enhanced global presence. The Power Transmission Group and Air Spring Systems also will achieve positive results from the merger,” said Heinz-Gerhard Wente, CEO of the ContiTech division.
According to Continental, an hypothetic merger between ContiTech and Veyance’s in 2013 would have reported sales at €5.4bn and a worldwide workforce of 9,000.
Veyance Technologies manufactures conveyor belts, hoses, power transmission belts and air springs, has 27 plants worldwide and employs 9,000 people. The company was a subsidiary of Goodyear Tire & Rubber until 2007 when it was acquired by Carlyle for $1.47bn although it kept the Goodyear brand.
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