FLSmidth acquires thyssenkrupp’s Mining business
FLSmidth A/S announced that has reached an agreement to acquire thyssenkrupp’s mining business for €325 million (about $386 million).
Headquartered in Denmark, FLSmidth is one of the leading suppliers of technologies for the mining and cement industries. The acquisition of German-based thyssenkrupp will enhance its global presence around the globe.
“The combined full-line coverage of FLSmidth and thyssenkrupp’s mining business includes a strengthening of our pit-to-plant range of technology, equipment and service expertise, as well as best-in-class digital solutions, covering continuous mining, mineral processing, mining systems and material handling,” FLSmidth said in a statement on its website. “The acquisition will also increase the installed base and customer base, increasing our competencies to serve our customers across multiple technologies. This will allow for more robust customer approach in service and aftermarket, as well as for the creation of strong strategic opportunities and boosting resource and investment in R&D, digital and innovation. This will result in a shorter time to market for new innovations and technologies.
“We also both share a common belief in bringing sustainable technology to the market in order to increase customer productivity and profitability. We see the thyssenkrupp Mining offering as an ideal fit with FLSmidth’s MissionZero sustainability ambition and with our digitalization agenda,” said FLSmidth. “Overall, we see the mining industry as heading into a growth phase, and this acquisition will place FLSmidth in an even better position to meet customer needs.”
With the sale, thyssenkrupp is successfully divesting the first major portfolio company in this segment. The business unit currently employs some 3,400 people and generated sales of around EUR 0.8 billion in fiscal year 2019/2020. The sale is an important step in the initiated transformation of the group and the associated focusing of the portfolio. The aim is to transform thyssenkrupp into a high-performing “group of companies” with independent businesses, a lean holding company and a focus on systematic performance improvement across all businesses.
“The successful sale of the Mining business shows that we are pressing ahead at full speed with the transformation of thyssenkrupp and achieving important results step by step. But we have not yet reached our goal. The principle ‘Performance first’ continues to apply. We need to return to positive cash flow as quickly as possible. The sale of Mining Technologies makes an important contribution to this,” said Martina Merz, CEO of thyssenkrupp AG. “At the same time I am pleased that we have found a very good new owner in FLSmidth. FLSmidth presented a convincing business strategy and a clear vision for the Mining business. It will give our employees attractive prospects. That was extremely important to us when negotiating the sale.”
The acquisition is subject to merger control and clearance from the relevant authorities in multiple jurisdictions. If approved, completion of the transaction is expected in the second half of 2022.