Munich, Germany – German plastics and rubber machinery maker KraussMaffei Group (KM) has been bought by the China National Chemical Corporation (ChemChina), a state-owned group, for €925m.
The deal, which had been mooted last week, will not affect KM’s corporate structure and the business will continue to be headquartered in Munich. KM employs around 4,500 people around the world, of which 2,800 are based in Germany.
Once cleared by the competition authorities it is expected the acquisition will complete by the end of June this year.
KM, ChemChina and Onex Corporation, the Toronto-based private equity firm that has owned KM since 2012, announced the transaction yesterday. The €925m consideration is a 62 percent gain on the €568m deal in 2012 when Onex bought KM from Madison Capital Partners.
ChemChina called KraussMaffei “the Rolls-Royce” in the polymer machinery industry. It said the deal was the single largest investment that a Chinese company had ever made in Germany.
In a joint statement, both ChemChina and KM chief executive Frank Stieler described the prospective new owner as a long-term investor – a contrast from KM’s last two private equity ownership groups.
“With ChemChina, we have found a strategic and long-term oriented investor who has been interested in our company for many years,” Stieler said.
ChemChina said its existing machinery subsidiary – China National Chemical Equipment – and KM had complementary product portfolios and markets. In addition, they were strategically and organisationally aligned with compatible management and cultures, allowing for significant synergies, it said.
ChemChina Chairman Ren Jianxin said in a statement: “We are strengthening our company with one of the leading global engineering groups, encompassing a 178-year corporate history. In doing so, we expect that KraussMaffei Group will maintain its identity and independence.”
ChemChina claims to be China’s largest exporter of rubber machinery.
Ren said the deal is also an implementation of China’s ‘One Belt One Road’ and “international production capacity cooperation” initiatives.
ChemChina Chairman Ren said the company was investing in KM’s strong management team and technological expertise.
“The growth potential of the KraussMaffei Group is tremendous, especially through improved access to the Chinese market, which we can make possible,” he said.