German automotive supplier and tyre maker Continental has concluded an agreement with The Carlyle Group based in Washington D.C., US, relating to the purchase of Veyance Technologies based in Fairlawn, Ohio, US for approximately EUR1.4 billion. Veyance operates globally in the field of rubber and plastics technology and in 2013 recorded sales of approximately EUR1.5 billion, around 90%t of which were achieved outside the automotive industry. Veyance has 27 plants around the world and a workforce of about 9,000 employees at the end of 2013. The acquisition is subject to the approval of the responsible anti-trust authorities.
The planned integration of Veyance into our ContiTech division is expected to expand Continental’s global business and sales in rubber and plastics technologies. ContiTech itself will achieve some 60% of its sales outside the automotive OE sector in future, according to Dr Elmar Degenhart, Chairman of Continental’s Executive Board in Hanover. The acquisition can be financed from cash and available credit lines.
Veyance Technoloes will complement the ContiTech division in key markets, particularly in the US and South America. Plants in Mexico, Canada, China, Australia and also South Africa. The ContiTech’s Conveyor Belt Group and Fluid Technology business units in particular will benefit from an enhanced global presence. The Power Transmission Group and Air Spring Systems also will achieve positive results from the merger.
In 2013 ContiTech’s and Veyance’s merged pro forma sales will add-up to approximately EUR5.4 billion, and they employ about 39,000 people worldwide. Veyance Technologies achieves about half of its sales in the US. Other important markets are Latin America, Africa, China and further Asian countries. The product focus is on conveyor belts, hoses, power transmission belts and air springs.