STOCKHOLM, Sweden—Trelleborg A.B.'s Wheel Systems business will virtually double its annual revenues once a major transaction to purchase CGS Holding a.s. and three subsidiaries is finalized.
Trelleborg plans to buy the operations to strengthen the firm's position in a number of key sectors, according to Peter Nilsson, president and CEO of the Stockholm-headquartered company.
Calling it a highly complementary acquisition, he said the additions are a “significant and attractive add-on to our existing businesses.” He noted that the companies have strong performing operations in the agricultural and industrial tire fields as well as engineered rubber products.
It will pay about $1.25 billion on a cash and debt-free basis for CGS and subsidiaries Mitas a.s., Rubena a.s. and Savatech d.o.o. The deal is expected to be completed in the first half of 2016 once approval from relevant authorities is received, a company spokeswoman said.
“Until we get approvals and finalize the transaction, it is business as usual,” she said.
Headquartered in the Czech Republic, Mitas is a leading global manufacturer of agricultural, industrial and specialty tires. The spokeswoman said Mitas accounts for about two thirds of CGS' sales “and has strong mid-market specialty tire brands with a particularly strong position in agricultural tires.”
Rubena and Savatech develop and manufacture a broad range of engineered polymer products, including seals, sealing profiles, specialty conveyor belts, offset printing blankets and engineered fabrics, molded goods, and other products.
It is the largest transaction Trelleborg has made since it purchased Polymer Sealing Solutions, which eventually became Trelleborg Sealing Solutions, in 2003, the spokeswoman said.