The reported value of the deal is €100 million and it was entirely financed by equity investment. Both parties said they expect the acquisition to close by the end of the year.
With the acquisition, 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,” said Jukka Jäämaa, president and CEO of Moventas companies.
“This also significantly strengthens our position and opportunities on our main markets,” Jäämaa said.
Based in the UK, Clyde Blowers’ activities 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.
At present the company is focusing much of its efforts on the growing in the fast developing regions of India, China and South America.
Moventas is operates state of the art manufacturing and test facilities and has an extensive product line in the wind turbine gearbox and drive solutions market.
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.
Moventas had been hurt by significant investments in its gear production during the years 2007-2008, encouraged by strong demand that evaporated following the global financial crisis.
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,” Jäämaa said. “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.”
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.
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