Hydro divests automotive structures activities
Norsk Hydro ASA has entered into an agreement to divest its automotive structures business to Benteler Automobiltechnik GmbH, the automotive division of the large German industrial enterprise Benteler Group with headquarters in Paderborn, Germany.
The agreement represents a solid, long-term industrial solution for Hydro’s automotive structures activities, and is in line with Hydro’s strategy to focus its extruded activities on profiles solutions and building systems.
The transaction is expected to be cash neutral for Hydro, and an estimated after tax loss of NOK 250 million will be recognized in Hydro’s fourth quarter 2009 results. Hydro expects the transaction to close by the end of fourth quarter 2009 subject to clearance by relevant competition authorities and other anti-trust bodies.
”We are pleased to have found a buyer with the ambition, competence and size to further develop the automotive structures activities,” says Executive Vice President Johnny Undeli, responsible for the Extruded Products business area in Hydro.
Hydro’s automotive structures business, part of the Extruded Products business area, is a leading supplier of advanced crash management systems, roll-over bar protection systems and other structural components and assemblies, serving the majority of the global carmakers. The business has a significant part of its production at Raufoss in Norway, with other plants in China, Czech, Denmark, France, Germany, Sweden and the United States. Revenues amounted to NOK 2.2 billion in 2008 and the business had about 1,200 employees at the end of third quarter 2009.
The Benteler Group is internationally active with its business divisions Automotive, Steel/Tube and Distribution and was founded in 1876. Operating under the Benteler name, the business is not only one of the largest independent automotive suppliers, but also one of the most important steel tube manufacturers in Europe as well as one of the leading stock holders and processors of steel tubes and stainless steel tubes. Today, Benteler employs more than 24,000 persons at 150 locations in 35 countries.
”We’ve restructured and reduced the size of our automotive structures activities over the past years. This has improved financial results, despite the economic downturn,” says Undeli. “After having run these operations for a number of years without satisfactory earnings, we feel convinced that the new owner will concentrate fully on serving the automotive industry and that it will add the competence necessary to increase profitability and market position.”
Hydro, an integrated aluminium and energy company, will continue to be a major supplier of aluminium, as well as semi-fabricated rolled and extruded aluminium profiles, to the automotive industry after the divestment.