UPDATE 1-China's XCMG buys majority of Germany's Schwing
(Adds details on company, financing)
FRANKFURT, April 19 (Reuters) - China's Xuzhou Construction Machinery Group (XCMG) has agreed to buy a majority stake in privately held German machinery manufacturer Schwing, the latest in a series of deals by Chinese companies to acquire German industrial know-how.
The German concrete pump maker, one of the world's leading suppliers in its field, did not disclose the price of the investment in its statement on Thursday. Reuters first reported a deal was imminent on March 23..
"The premium brand Schwing is a central part of our strategic development," XCMG head Wang Min said in the statement, which also said German management would remain in charge.
The deal follows a series of similar tie-ups this year in which Chinese firms have scooped up German groups to gain access to technology, brands and a worldwide distribution network.
In March, German car parts maker Kiekert said it was being bought by Chinese peer Hebei Lingyun..
In January, China's Sany Heavy Industry said it would buy Schwing rival Putzmeister in a 360 million euro ($472 million) deal, and LDK Solar invested in German solar group Sunways.
Schwing's concrete pumps are being used to build the new high-rise building of the European Central Bank in Frankfurt, Dubai's exclusive Jumeirah Beach Residence and New York's new One World Trade Center.
With the help of XCMG, Schwing hopes to expand onto Asian markets, the company said.
XCMG is seeking a U.S. dollar loan worth about 160 million euros ($210 million) to refinance a bridge loan to help finance the Schwing acquisition, Thomson Reuters publication Basis Point reported earlier this week.
Banks are invited to join the three-year term loan, with a road show scheduled for April 25 in Hong Kong, it quoted banking sources as saying.
Schwing, owned by the Schwing family, posted sales of roughly 500 million euros in 2011. It also posted a profit in 2011, a source close to the company said.
The Herne, Germany-based company employs about 3,300 staff, but is cutting 160 jobs after its sales dropped by 30 percent amid the economic crisis. After the investment by XCMG, no further job cuts are planned, a spokesperson said.
Rothschild advised Schwing on the deal.
($1 = 0.7621 euros) (Reporting by Arno Schuetze and Sabine Wollrab; Editing by Mark Potter and Jane Baird)
- Malaysia Airlines plane missing, presumed crashed in South China Sea |
- CORRECTED-UPDATE 4-Malaysia Airlines plane crashes in South China Sea with 239 people aboard - report
- China draws 'red line' on North Korea, says won't allow war on peninsula
- Malaysian plane crashed off Vietnam coast: state media
- No signal picked up from missing Malaysia Airlines plane-Vietnam official