TRELLEBORG, Sweden (Nov. 24, 2010)—Trelleborg A.B., through its Trelleborg Wheel Systems S.p.A. unit, has agreed to buy Watts Tyre Group, the Lydney, England-based industrial tire maker, for about $32 million.
Trelleborg said the acquisition, which is subject to the approval of appropriate authorities, will strengthen its position in industrial tires through geographic expansion and an increased aftermarket presence. It expects the deal to be finalized in the first quarter of 2011.
Watts, represented in North America by Watts Industrial Tyre Services L.L.C. in Rossville, Ga., has annual sales of about $42 million and about 230 employees. Watts produces rubber and polyurethane solid and pneumatic industrial tires in plants in Sri Lanka, China and Brazil, specializing in materials-handling and forklift tires, using the Premia, Kargo and FMCX brand names.
“The acquisition is a further step in our strategy to continuously strengthen our positions in selected segments,” said Maurizio Vischi, president of Trelleborg Wheel Systems. “The acquisition improves our positions and generates opportunities for future growth. This also creates favorable possibilities for synergies, primarily through increased use of our efficient and modernized plant in Sri Lanka.”
Among the strengths Watts brings is an “advance service concept” known as Interfit, Vischi said, along with a broader geographic presence, especially in Asia.
Trelleborg expects Watts to contribute favorable earnings from the date of takeover. The annualized positive bottom-line effect should be about $6.5 million, the company said.
Watts has been making and distributing industrial tires since 1960, with direct distribution assets in the United Kingdom, France, Germany, Mexico, Uruguay and the U.S. and partner distributors in 60 more countries around the world.
This is the second ownership change for Watts Tyre in a year. In 2009 the business was bought by Premia Group Ltd., a private consortium owned by three former Watts Tyre executives — Jean-Paul Mindermann, Paul Morey and Andreas Karnein, CEO, finance director and technical director, respectively, of Watts Tyre.