Triton has agreed to acquire most of European steel producer Ovako, for an undisclosed amount. The deal does not include Ovako’s wire division. No financial terms were disclosed.
Triton, a European private equity investor with a strong presence in the Nordic region, has concluded an agreement to acquire all shares in the companies belonging to the Bar, Bright Bar, and Tube and Ring divisions of Ovako, a leading European steel producer. These companies produce and market long special steel products in the form of bars, chromed bars, tubes and rings as well as components for the vehicle and general engineering industries. The transaction does not include Ovako Group’s operations belonging to the Wire Division, which produces and markets long special steel products in the form of wire rod and PC strand.
The operations of the acquired companies, consisting of 12 production units mainly in Sweden and Finland and 6 sales offices in Europe and North America, will continue under the name Ovako. The turnover of the new Ovako is estimated at around EUR 850 million for 2010 and the number of employees is 3,000. The steel production capacity amounts to 1.2 million tonnes.
The purchase price shall remain confidential. Completion of the transaction is pending, on approval from the competition authorities.
“The new Ovako is a structurally stable company that returns good profitability over business cycles,” says Ovako’s President & CEO Jarmo Tonteri, who will continue in this position at the new Ovako. “The new owner will provide us with the financial strength we have been lacking during the financial turmoil of the last couple of years,” he points out.
“This gives us an opportunity to focus on maintaining a leading position in Europe’s special steel markets and even a globally strong market position for selected niche products, such as steel for roller bearing applications. Our capability to grow, both organically and possibly through acquisitions, will also be much better,” says Tonteri.
The units included in Triton’s acquisition of the three Ovako divisions Bar, Bright Bar, and Tube and Ring have operations in the following locations: Hofors, Hällefors, Smedjebacken, Boxholm, Forsbacka, Hallstahammar and Mora in Sweden, Imatra and Turenki in Finland, Twente in the Netherlands, Redon in France and Molinella in Italy. The sales offices included in the transaction are based in Germany, the UK, France, Poland, Russia and the USA.
The new owner Triton is a leading private equity firm focusing on the Nordic and German speaking regions of Europe. The company manages total investments of more than EUR 4 billion from Nordic and international investors. Triton has offices in Stockholm, Frankfurt and London.
Triton invests in market-leading businesses with strong management teams to create long-term value. In recent years, the company has focused on investments in the fields of business services, industry, consumer products and health care. At the moment, Triton’s investment portfolio includes among others the following companies: the leading Nordic healthcare and care service provider Ambea, which owns Carema and Mehiläinen; the building materials distributor Puukeskus; the paper and packaging materials distributor Papyrus; and the leading Nordic electricity, plumbing and HEVAC installation and maintenance company Bravida.