Global industrial engineering group Clyde Blowers has yesterday signed an agreement to acquire the wind gear manufacturer Moventas Wind Ltd and the industrial gear manufacturer Moventas Santasalo Ltd. Following the acquisition of the Moventas companies, Clyde Blowers, with its existing David Brown Gear Systems business, will be one of the largest gear manufacturing groups in the world.
– We are very pleased to get an excellent owner for us with an industrial background – Clyde Blowers offers us stability and further development of our business. This also significantly strengthens our position and opportunities on our main markets, comments President & CEO of Moventas companies Jukka Jäämaa.
Clyde Blowers is an industrial engineering group headquartered in the UK. Its interests cover a wide range of industrial engineering activities in the power (including renewable energy, conventional and nuclear), oil & gas, mining and minerals, rail and other industrial markets. Clyde Blowers carries out activities across the world, with particular focus on growing its activities in fast developing regions such as India, China and South America. Clyde Blowers knows the global gearing business very well, as one of the group companies is David Brown Gear Systems, which manufactures industrial gear and drive systems for various industries.
– Moventas is a very high quality engineering business with a fantastic product range, a strong dedicated management team with deep engineering capability and excellent customer relationships. Moventas operates some of the most advanced, state of the art manufacturing and test facilities in the world and has an extensive product range. It is a leading independent player in the global Wind turbine gearbox and drive solutions market with products extending across a wide range of wind turbines. Additionally they have a world class capability and exceptionally strong product offering for a wide range of industrial markets and are well positioned for future growth. We are very excited about the future prospects for Moventas, says Chairman and Chief Executive of Clyde Blowers, Jim McColl.
A new long-term ownership solution has been sought for Moventas companies since June when, after prolonged financing negotiations, the holding company Moventas Ltd was filed for bankruptcy and its operative subsidiaries applied for corporate restructuring.
As its European competitors, Moventas made significant investments in its gear production during the years 2007-2008 encouraged by strong demand. However, the post finance crisis markets have not supported these investments, and along with its competition Moventas has suffered from excess capacity.
As part of its corporate restructuring, Moventas is now exploring possibilities of reorganizing its production in Finland. Therefore, both Finnish Moventas companies will start co-operation negotiations on 21 November, 2011.
– To ensure that the core operations of gear production can remain in Finland, reorganizing and downscaling are completely necessary regardless of the acquisition. We have world-leading companies as our customers, high engineering know-how and quality products, but the excess capacity heavily strained our financial status, leaving us loss-making. Implementation of the corporate restructuring program offers us an excellent starting point for future success, Jäämaa stresses.
Based on the sales and purchase agreement signed yesterday, the objective is to close the acquisition before the year-end. The business has been acquired for the price of 100 million euros, and has been solely financed by equity investment.
Corporate restructuring proceedings of Moventas Wind Ltd and Moventas Santasalo Ltd will end simultaneously with the closing, and restructuring programs will be implemented. Due to the corporate restructuring proceedings, the co-operation negotiations will take two weeks.
Danske Bank Corporate Finance and Pohjola Corporate Finance acted as joint financial advisors and Attorneys at law Borenius as a legal advisor to the seller.