Bekaert, a worldwide technology and market leader in steel wire transformation and coatings, has reached an agreement with Arrium Ltd for the acquisition of its wire ropes business in Newcastle, Australia. The integration of the Australian ropes activities will enhance Bekaert’s growth strategy in steel wire ropes in general and will enable the Group to take a leading global market position in mining ropes in particular.
Deal scope and structure
The acquisition agreement includes the purchase by Bekaert of Arrium Ltd’s steel ropes business. The deal includes all of the personnel and assets of the business located in Newcastle, Australia. The transaction is estimated to add € 40 million to Bekaert’s consolidated sales on an annual basis, has an enterprise value of approximately € 60 million and is subject to customary closing conditions. Bekaert and Arrium anticipate a deal closing in the course of the first quarter of 2015.
Upon deal closure, the Australian ropes activities will be integrated in the Bekaert Rope Group. In this newly established Group, Bekaert and their Chilean partners, through Matco Cables S.A., now hold 65% and 35% respectively of all ropes entities in Canada, Chile, Peru, Brazil and the US.
Bekaert steel wire ropes activities
Bekaert is gradually expanding its steel wire ropes platform to serve mining, oil & gas, lifting equipment and infrastructure markets with high performance ropes. The platform’s strategy targets both organic and acquisitive growth in markets with interesting potential where Bekaert’s core competences, global reach and service model offer a differentiating lever to the industry. Bekaert’s ropes platform has been steadily growing over the past years and covers manufacturing and development facilities in Canada, Chile, Peru, Venezuela, Brazil, US, China and Malaysia. The announcement of today fits within Bekaert’s strategy to grow this business together with the company’s existing Chilean partners.
Arrium’s wire ropes activities
The wire ropes division of Arrium is a leading manufacturer of mining wire ropes and has a long history of rope-making in Australia. With 90 years of experience, it is a trusted supplier of high performance ropes to the mining industry in particular. The business employs more than 100 people, all operating in Newcastle, Australia. Arrium is an international diversified mining and materials company with key businesses in mining, mining consumables and steel.
Bekaert Profile
Bekaert (www.bekaert.com) is a world market and technology leader in steel wire transformation and coatings. Bekaert (Euronext Brussels: BEKB) is a global company with headquarters in Belgium, employing 28 000 people worldwide. Serving customers in 120 countries, Bekaert pursues sustainable profitable growth in all its activities and generated combined sales of € 4.1 billion in 2013.
Disclaimer
The foregoing release may contain forward-looking statements regarding the impact of the transaction on the financial statements of Bekaert. Such statements reflect the current views of management regarding future events, and involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any future results, performance or achievements expressed or implied by such statements. Bekaert is providing the information in this press release as of this date and does not undertake any obligation to update any forward-looking statements contained in this press release as a result of new information, future events or otherwise. Bekaert disclaims any liability for statements made or published by third parties and does not undertake any obligation to correct inaccurate data, information, conclusions or opinions published by third parties in relation to this or any other press release issued by Bekaert.