Concentric completes acquisition of GKN Sinter Metals de Argentina SA
Concentric AB (“Concentric”) today announces the completion of the acquisition of GKN Sinter Metals de Argentina SA (“GKN Pumps”), a supplier of engine pumps in South America, strengthening Concentric’s presence in the region. GKN Pumps has a production facility in Chivilcoy, Argentina that will provide Concentric with an important foothold in the Mercosur trade union, thereby enabling further penetration of the South American market. GKN Pumps was previously part of GKN Powder Metallurgy, a division of GKN plc (listed on UK LSE) and one of the world’s largest manufacturers of metal powder and sintered components.
The acquisition gives Concentric direct access to the commercial vehicle market in South America and will enable Concentric to build even closer relationships with its existing global customers. There are also operational synergies as Concentric will be able to in-source a share of its global purchases of sintered components. GKN Pumps will initially continue to focus on the manufacture of engine products but, in the long-term, Concentric would also like to introduce the manufacture of hydraulic products to this facility. For the year ended 31st December 2014, GKN Pumps made sales of approximately 100 MSEK with 166 employees.
David Woolley, CEO of Concentric, comments:
“We have put a lot of effort into identifying acquisition targets that have processes, manufacturing capabilities and products which match Concentric’s quality standards and that also have a strong management team in place. GKN Pumps meets all these criteria and will improve Concentric’s ability to sell locally to our existing global customers. We plan to strengthen the local engineering capabilities in line with the group’s global strategy to source, manufacture and provide applications support locally to our customers. I am also confident that, in the long-term, GKN Pumps will deliver margins in line with the rest of the group.”
The transaction was completed on 30 January, 2015 and has gained all the necessary approvals. The current managing director of GKN Pumps will remain with the company and help integrate the business over the coming year. GKN Pumps will be consolidated in Concentric’s financial statements as of 1 February, 2015. The parties have agreed not to disclose the purchase price.
For further information, please contact David Bessant, CFO, tel +44 121 445 6545.