ElringKlinger AG

euro adhoc: ElringKlinger AG
Mergers - Acquisitions - Takeovers / ElringKlinger close to signing deal for takeover of Swiss heat shield specialist SEVEX AG

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Company Information

14.02.2008

Dettingen/Erms (Germany) / Sevelen (Switzerland), February 14, 2008   +++ ElringKlinger AG is close to finalizing an agreement for the acquisition of SEVEX AG, Sevelen, a Swiss manufacturer of thermal and acoustic shielding systems. In addition to acquiring the Swiss parent company, ElringKlinger plans to take over the US-based subsidiary SEVEX North America, Inc., Buford, as well as SEVEX Asia, headquartered in Suzhou, China.

Negotiations nearing completion ElringKlinger is currently working on the assumption that the purchase agreement will be signed by the end of March 2008. Both parties to the contract have agreed not to disclose details of the purchase price. The closing of the takeover transaction is subject to the usual provisos, in particular the receipt of official approval by the antitrust authorities.

The SEVEX Group has targeted sales revenue of around CHF 95 million for 2008 (EUR 59 million). The purchase price is within a range of 7- to 8- times EBIT (earnings before interest and taxes).

Complementary technology Increasingly, automobile manufacturers are turning to smaller, lighter and, in many cases, turbocharged engines with complex exhaust-cleaning technology, the objective being to scale down fuel consumption and reduce emission levels. Given the sophisticated engineering processes associated with such high-end solutions, state-of-the-art automotive components such as thermal shielding systems are becoming increasingly important to the overall design. Whereas ElringKlinger has established a strong position within the area of engine shielding components, SEVEX is recognized as one of the leading suppliers of underbody heat shield systems and solutions deployed in the vehicle exhaust tract, drawing on its extensive knowledge of the materials and engineering processes involved. Thus, the SEVEX Group is the perfect complement to ElringKlinger's existing product portfolio. SEVEX operates development and production units in Sevelen (Switzerland), Buford (Georgia, USA) and Suzhou (China).

ElringKlinger advances to become second largest supplier worldwide In 2006, ElringKlinger generated sales revenue of approx. EUR 72 million in its Shielding Technology division and is targeting an increase to around EUR 90 million in 2007. The acquisition of SEVEX would propel the ElringKlinger Group to second place in the international supplier ranking for engine, underbody and exhaust tract shielding systems.

ElringKlinger AG's Chief Executive Officer, Dr. Stefan Wolf, underlined the technological and strategic importance of the acquisition: "In SEVEX, we have found the perfect complement to our core business. By joining forces, we will be able to position ourselves as a one-stop system supplier of engine, underbody and exhaust tract components. This will provide us with an even better vantage point when it comes to unlocking future business development and growth opportunities within the niche market of shielding technology." Wolf added, "Our aim is to integrate SEVEX within our Group's international production network as soon as possible. We also believe that the transaction will be earnings accretive as early as 2008."

SEVEX AG is one of the leading companies specializing in the development and production of high-performance heat shields for the automobile industry as well as system suppliers operating within the automotive sector. Its customer base includes all of the major European car manufacturers and suppliers. Employing some 330 people worldwide, SEVEX is considered one of the market leaders within the heat shield business. Operating at a global level, the ElringKlinger Group is a leading development partner and original equipment manufacturer within the area of cylinder-head and specialty gaskets as well as housing modules and shielding components used in engines, transmissions and exhaust systems. The company's R&D activities focus on reducing fuel consumption, scaling back or eliminating emissions and developing alternative propulsion concepts. ElringKlinger is currently working on several new projects, including the development of fuel cell components and an innovative diesel particulate filter. The ElringKlinger Group employs around 3,500 people at 21 facilities worldwide. In the 2006 financial year, ElringKlinger reported sales revenue of EUR 528.4 (474.6) million and consolidated net income, after minority interests, of EUR 57.8 (42.4) million.

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ots Originaltext: ElringKlinger AG
Im Internet recherchierbar: http://www.presseportal.ch

Further inquiry note:
ElringKlinger AG
Kathrin Müller
Tel. +49 (0) 7123/724-631
kathrin.mueller@elringklinger.de

Branche: Automotive Equipment
ISIN:      DE0007856023
WKN:        785602
Index:    SDAX, CDAX, Classic All Share, Prime All Share
Börsen:  Börse Frankfurt / regulated dealing/prime standard
              Börse Berlin / free trade
              Börse Düsseldorf / free trade
              Börse München / free trade
              Börse Stuttgart / regulated dealing