MALMO, Sweden-Svedala Industri A.B., parent of the Trellex conveyor belting and mining products group, is acquiring Skega A.B., a maker of abrasive-resistant rubber products for the mining and mineral industries.
The acquisition, for an undisclosed amount, will increase Svedala's rubber-related sales revenue about 50 percent to more than $250 million annually, the firms said.
Ersmark, Sweden-based Skega operates manufacturing facilities in several countries, including Canada, Mexico, Chile and Peru.
Founded in 1936 as a compost lining installer, Skega was purchased in 1969 by the diversified holding company Incentive A.B. Incentive determined last year Skega no longer fit into its plans and placed the unit on the block.
Swedish antitrust authorities will review the transaction for 30 days, but the companies said they anticipate no problems.
Skega employs 600 at its factory and headquarters in Ersmark. The company reports annual sales of about $80 million, 70 percent of which is generated outside Sweden.
Despite the apparent overlap in product offerings, Svedala considers the purchase one that will complement its existing product catalog. Skega traditionally has concentrated on heavy mining applications, whereas Svedala has pursued business in the finer minerals business areas, the spokesman said.
Most recently, Skega set up a 50-50 joint venture in Melbourne, Australia, with Pacific Dunlop Ltd. to make and sell mill linings to the ore processing industries in Australia and throughout the Pacific Rim.
Svedala's Trellex activities-originally Trelleborg A.B.'s conveyor belting and mining products business area-made up the core of Svedala's business at its inception eight years ago, and now represent 10 to 12 percent of the corporation's $1.34 billion annual sales. Svedala is present in North America through its Trellex Morse Division in Keokuk, Iowa.