Sector News

ChemChina agrees to acquire Germany’s KraussMaffei in $1 billion deal

January 11, 2016
Chemical Value Chain

A consortium of investors including China National Chemical Corp. agreed to buy KraussMaffei Group for 925 million euros ($1 billion) including debt in what could be the largest Chinese takeover of a German company ever.

China National Chemical Corp., known as ChemChina, has been an aggressive overseas acquirer in recent years. Last year, it agreed to a roughly $7.7 billion deal to buy Italian tire maker Pirelli & C. SpA and is nearing shareholder approval to complete that deal.

The acquisition of KraussMaffei, a maker of equipment that processes plastics and rubber, would rank as the biggest outbound investment from China into Germany, according to data provider Dealogic. The largest Chinese acquisition of a German company to date was the $694 million acquisition of Putzmeister Holding, a maker of high-tech concrete pumps, by Chinese construction-equipment company Sany Heavy Industry Co. in 2012.

The group of investors acquiring KraussMaffei includes private-equity firm AGIC Capital and Chinese state fund Guoxin International Investment Corp., according to a statement from AGIC Capital. KraussMaffei‘s current owner is Canadian private-equity firm Onex Corp., which acquired the business in 2012 for €568 million.

The deal is expected to close in the first half of the year, Onex said Monday in a statement.

The deal is the first for AGIC Capital, a new private-equity fund established by former Deutsche Bank Group AG banker Henry Cai. The fund is raising $1 billion to buy businesses in German-speaking countries with the aim of growing their China business by joining up with local Chinese industrial companies who can use their technology.

KraussMaffei’s developments in new materials such as carbon fibers stand to benefit from China’s objective to advance its industry toward high-end manufacturing, said Wolfgang Seibold, AGIC’s head of Germany.

Mr. Cai set up AGIC in early 2014 after serving as executive chairman of corporate finance for Asia-Pacific at Deutsche Bank AG, and before that as chairman of investment banking in Asia for UBS Group AG. Mr. Cai made his name as an aggressive deal maker who courted Chinese entrepreneurs and led them through Hong Kong initial public offerings.

Fundraising for AGIC Capital’s first fund started in March 2015 and reached a “first closing,” the point at which a fund can begin spending money on deals, in August 2015, the firm said in it statement.

By Alec Macfarlane

Source: Wall Street Journal

comments closed

Related News

May 21, 2022

Sika opens new manufacturing plant in Bolivia 

Chemical Value Chain

Sika AG (Baar, Switzerland) has opened a new plant in Santa Cruz de la Sierra, thus doubling its production capacity for mortar and concrete admixtures in Bolivia. With this new facility in one of the country’s main industrial agglomerations, Sika is positioning itself for continued growth in the dynamic Bolivian construction market.

May 21, 2022

Chevron increases renewable fuel market share with REG acquisition

Chemical Value Chain

Chevron Corporation (NYSE: CVX) and Renewable Energy Group, Inc. (NASDAQ: REGI) (REG) announced on Monday a definitive agreement under which Chevron will acquire the outstanding shares of REG in an all-cash transaction valued at $3.15 billion, or $61.50 per share.

May 21, 2022

Lotte Chemical to invest $8 bn on hydrogen energy, battery materials by 2030

Chemical Value Chain

Lotte Chemical Corp. will invest 10 trillion won ($8 billion) on hydrogen and battery materials through 2030 to achieve annual revenue of 50 trillion won and carbon neutrality. The Korean chemical producer on Thursday unveiled its new corporate vision outlining key corporate strategies with focus on growth through hydrogen energy and battery materials businesses.