Subject: TNM
Sandvik to acquire majority stake in China-based Suzhou Ahno
STOCKHOLM, April 23, 2024 /PRNewswire/ -- Sandvik has signed an agreement to acquire a majority stake in the leading China-based company Suzhou Ahno Precision Cutting Tool Technology Co., Ltd. (Ahno) from the current majority owner, Ningbo Baosi Energy Equipment Co., Ltd and related parties. The company will be reported within the business area segment Sandvik Machining Solutions.
Ahno has a leading position in precision cutting tools in the fast-growing local premium segment, with a broad product-and service offering and extensive sales, distribution and production footprint in China. The main customer industries are general engineering and automotive, in which a significant part is towards electric vehicles, and with medical being a growing segment for the company. With this acquisition Sandvik Machining Solutions further strengthens its leading position within round tools.
"This acquisition will strengthen our position in the strategically important Chinese market. Ahno's competitive assortment and closeness to customers is a great platform to drive further growth of our tooling business in China. Much of the offering is focused on fast growing segments, like electric vehicles, which makes Ahno a perfect fit with our strategy," says Stefan Widing, President and CEO of Sandvik.
Ahno will form the basis of a new China-based division within Sandvik Machining Solutions. The new division will be established following the closing of the transaction. Sandvik's international tooling brands will continue to be operated in China as they are today. Ahno's strong market position, combined with Sandvik's leading competence and international brands presence will enable an attractive growth platform in China for China going forward.
"This acquisition is in line with our strategic ambition to grow in China and build a leading position in the local premium segment. In addition, Ahno enhances our local production capabilities, making it a great addition to Sandvik," says Nadine Crauwels, President Sandvik Machining Solutions.
Following the transaction, Sandvik will own a 72.4% stake in Ahno. This builds on a previous ownership stake of 12.4%. The company was founded in 2002, has approximately 1,200 employees and is headquartered in Suzhou, China. In 2023, the company generated revenues of approximately CNY 812 million (1.2 BSEK), mainly from China. The impact on Sandvik's EBITA margin will be limited. The impact on Sandvik's earnings per share (excluding non-cash amortization effects from business combinations) will be positive. The enterprise value for the acquired stake is CNY 1,456 million (189 MEUR) corresponding to a multiple of 10.9 x EV/EBITDA 2024. The transaction is expected to close during the third quarter of 2024 and is subject to customary closing conditions.
Stockholm, April 23, 2024
Sandvik AB
For further information, contact
Louise Tjeder, VP Investor relations,
phone: +46 (0) 70782 6374 or
Johannes Hellström,
Press and Media Relations Manager,
phone: +46 (0) 70721 1008.
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SOURCE Sandvik
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