Continental reports that the acquisition of US rubber company, Veyance Technologies, Inc., has been successfully concluded following approval from the Brazilian antitrust authority, CADE. The €1.4 billion acquisition boosts Continental’s international business.
Veyance operates globally in the field of rubber and plastics technology and in 2013 recorded sales of some €1.5 billion, around 90% of which were achieved in industry business. The workforce at its 27 plants around the world totaled 8500 at the end of 2013. Veyance Technologies generates around half of its sales in the US, where it is based. Other important markets include Latin America, Africa, China and other countries in Asia. The product focus is on conveyor belts, hoses and power transmission belts. In 2013, ContiTech and Veyance together achieved sales of €5.4 billion and employed around 38 000 staff worldwide.
“By integrating Veyance in our ContiTech division, we are expanding our global position in rubber and plastics technologies. In addition, this acquisition will bring Continental a significant step closer to its strategic goal of further increasing the proportion of industrial and end-customer business in its sales,” says Dr. Elmar Degenhart, chairman of Continental’s Executive Board in Hanover. “Continental has financed the acquisition entirely from liquid funds and available lines of credit. Veyance will make an immediate positive contribution to the corporation’s profitability.”
ContiTech’s Conveyor Belt Group (conveyor belt systems), Fluid Technology (hoses and hose assemblies) and Power Transmission Group (power transmission belt systems) business units will benefit in particular from the improved global alignment.
Because of the significance of the acquisition, antitrust authorities worldwide had spent the last 11 months scrutinising the purchase and its impact on the respective markets. In response to the structural concerns expressed by some of the antitrust authorities, Continental will divest Veyance’s air springs business in NAFTA and its current steel-cord belting business in Brazil. In total, around 600 employees work in the operations that are to be divested.
Adapted from press release by Katherine Guenioui
Read the article online at: https://www.worldcement.com/europe-cis/02022015/continental-finalises-veyance-acquisition-252/