In its latest overseas acquisition, China’s Zhongding Sealing Parts Co. Ltd. is buying 100 percent of the shares in German injection molder Wegu Holding GmbH for $107.4 million in cash.
The payment was made to DMB 1 Invest GmbH & Co. K.G., which owns 90 percent of Wegu’s publicly listed shares, Zhongding said. Wegu Managing Director Horst Zimmerman and Equitrust Beteiligungen GmbH each hold 5 percent.
By the end of September 2014, Kassel, Germany-based Wegu’s net assets reached $30.8 million, with $44.2 million of total assets and $13.4 million of total liabilities, Zhongding said in a statement.
For fiscal year 2013, Wegu reported $54.8 million in sales; $11 million in earnings before interest, taxes, depreciation and amortization; and net profit of $6.5 million. Preliminary financial numbers for the first nine months of 2014 showed sales of $45.2 million and net profit of $7.1 million.
Wegu, founded in 1949, specializes in rubber and plastics processing for vibration control and acoustics for the auto industry. Serving premium global brands such as BMW, Daimler, Audi and Land Rover, the company operates production facilities in Germany, Canada and Slovakia. – Rubbernews.com
Products that use polymers include airflow extractors (polypropylene and thermoplastic elastomers), steering column seals (nylon, TPEs and polyure-thane foam), and passenger compartment components such as dashboard mounting parts, steering column covers, speaker grills, crash-relevant parts and center consoles, as well as mud flaps.
Zhongding, based in Ningguo, China, said it expects the deal to advance its technologies in automotive noise reduction systems, especially in electric vehicles; help it enter the supply chain for premium brand auto makers; develop modular production and supply capabilities; and boost its product quality, production efficiency and profitability.
“Leveraging Wegu’s state-of-art production as well as its brand equity,” Zhongding said it hopes to break Western firms’ “long-term monopoly” in the high-end automotive vibration control field. It aims to grow market share by targeting both imported parts to China as well as exports.