FRANKFURT Jan 25 China's Sinomach
and France's Fives are set to split German-American
machine tool maker MAG Group between them, two people
familiar with the deal process said.
Sinomach is expected to sign a contract to acquire the
European operations of MAG in February, while Fives is the only
remaining bidder for the American operations, the sources said.
The sources did not disclose a possible price tag, but the
combined group will likely reap more than 500 million euros
($668 million), sources have said in the past.
MAG declined to comment, while Sinomach and Fives were not
immediately available for comment.
MAG's U.S. arm is owned by U.S. investor Mo Meidar, who
built up MAG Group seven years ago by buying a number of
industrial businesses - including units of ThyssenKrupp
and KUKA - and restructuring them.
He later had to cede control over MAG's European division to
banks including Deutsche Bank and Commerzbank
MAG Group has annual sales of 1 billion euros and in 2011
posted earnings before interest, taxes, depreciation and
amortization of 105 million euros. The group employs roughly
At the beginning of the auction, several other bidders from
China showed interest in MAG in a sign that the appetite of
Chinese groups for German technology, brands and distribution
networks is high.
Chinese companies last year swooped in on a number of German
groups, with Sany acquiring machinery group
Putzmeister and Hebei Lingyun buying car parts maker
Kiekert. Meanwhile, Shandong Heavy bought a 25 percent stake in
fork lift truck maker Kion Group.
The interest of Fives comes six months after the private
equity arm of French insurer AXA bought a stake in the
French engineering group, promising to finance its growth plans.