ContiTech Goes for Expansion - Acquisitions Underpin Strategy
Agreement signed on the acquisition of the molded brake components business from Freudenberg Sealing Technologies / Takeover of conveyor belt manufacturer Specialised Belting Supplies Ltd. strengthens ContiTech's Conveyor Belt Group
(PresseBox) (Hannover, )ContiTech is staying on track for expansion. The technology company, which belongs to the automotive supplier Continental, has signed an agreement covering the purchase of the molded brake component operations from Freudenberg Sealing Technologies, Weinheim. In addition, the British conveyor belt manufacturer Specialised Belting Supplies Ltd (SBS), Thetford, has also been acquired. "Both of these companies are of strategic significance for us," said ContiTech CEO Heinz-Gerhard Wente in Hanover. "In the automotive industry, we are improving our position in particular in the French market and in southern Europe, while at the same time expanding our product range with safety components for brake applications, which are very much in demand. In the conveyor belt business, we are opening up additional opportunities for ourselves in the growing worldwide market of steep inclined and vertical conveying of bulk materials."
The effective transfer of the molded brake components business from Freudenberg Sealing Technologies to ContiTech is still subject to approval by the antitrust authorities. With a workforce of some 500, Freudenberg develops and produces molded brake components in Andrezieux, France; Queretaro, Mexico; and Oberwihl, Germany. About 50 employees manufacture special conveyor belts at Specialised Belting Supplies Ltd. in Thetford, UK. With the latter company's production technology, ContiTech will also be in a position to produce highly temperature-resistant corrugated sidewall belts. The respective parties have agreed not to disclose any details of the purchase prices involved in the deals.
Both acquisitions are in line with ContiTech's expansion strategy which also includes the construction of new plants. "We are increasingly relying on growth in future-oriented industries and in international markets," said Wente, who is also a member of the Continental Executive Board. The investment to set up a greenfield plant for oil handling hoses in Brazil is worth special mention in this context. "At roughly €17 million, it is our biggest single investment this year", said Wente. Furthermore, ContiTech is planning a new plant for air-conditioning lines in Kaluga, Russia, which is slated to go into operation in 2013. The company is also investing more than €10 million in a new hose line plant in Serbia. Some €5 million will be put into a new production facility for rubber compounds in Hungary by the end of 2012.
Investments in existing locations
"This year, too, we will be sticking to our investment budget for new and existing plants and facilities, as long as the global economic situation remains stable", emphasized Wente. Millions are being channeled, for example, into the German sites of Hanover, Korbach, Karben, Northeim, Oppenweiler and Waltershausen.