Dana says it will benefit from Oerlikon's manufacturing and R&D footprint which will the company’s ability to serve its current customers while connecting us with new customers, especially in India and China.
30 Jul 2018 | 13870 Views | By Autocar Pro News Desk
Dana Inc has signed a definitive agreement to purchase the Oerlikon Group's Drive Systems segment. The Oerlikon Group is a global manufacturer of high-precision gears, planetary hub drives for wheeled and tracked vehicles, and products, controls, and software that support vehicle electrification across the mobility industry.
As per the agreement, Dana will acquire ...
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Dana Inc has signed a definitive agreement to purchase the Oerlikon Group's Drive Systems segment. The Oerlikon Group is a global manufacturer of high-precision gears, planetary hub drives for wheeled and tracked vehicles, and products, controls, and software that support vehicle electrification across the mobility industry.
As per the agreement, Dana will acquire Oerlikon's Drive Systems business for 600 million Swiss francs (Rs 3,813 crore). The acquisition is expected to close in late 2018 or the first quarter of 2019.
Dana, a world leader in highly engineered solutions for improving the efficiency, performance, and sustainability of powered vehicles and machinery, caters to the passenger vehicle, commercial truck, and off-highway markets, as well as industrial and stationary equipment applications. Dana employs more than 30 000 people in 33 countries on six continents and reported sales of $ 7.2 billion in 2017.
Dana says the acquisition is consistent with its enterprise strategy, and acquiring the Oerlikon Drive Systems will provide it numerous opportunities to drive profitable growth. Among them, the transaction:
"Oerlikon Drive Systems is a well-respected technology company that has provided exceptional product innovation and customer satisfaction for nearly a century," said Jim Kamsickas, president and chief executive officer of Dana. "A great fit culturally, this investment will deliver significant long-term value by accelerating our commitment to vehicle electrification and strengthening the technology portfolio for each of our end markets while further expanding and balancing the manufacturing presence of our off-highway business in key geographical markets."
Founded in 1919, Oerlikon Drive Systems generated revenue of 730 million Swiss franc (Rs 4,639 crore) in 2017. The business employs approximately 5,900 people and operates 10 manufacturing and engineering facilities in China, India, Italy, the United Kingdom, and the United States, with two additional facilities under construction in China.
The business serves a global roster of OEMs, its customers include AGCO, Ashok Leyland, Aston Martin, BMW, Caterpillar, CNH, Daimler, John Deere, Ferrari, Fiat Chrysler Automobiles, MAN, McLaren, Oshkosh, SANY, Scania, Terex, Volkswagen, and AB Volvo.
Oerlikon Drive Systems is composed of two global brands, Oerlikon Graziano and Oerlikon Fairfield, which offer engineering and manufacturing expertise in the development of gear-driven solutions for mobile vehicles and industrial equipment. Its products can be found in a wide range of applications for operating machinery and equipment used in agriculture, construction, energy, mining, transportation, and high-performance sports cars.
"This strategic deployment of capital for inorganic growth strengthens our product portfolio, will be immediately accretive to earnings upon closing, will create incremental value for shareholders, and preserves our strong balance sheet," said Jonathan Collins, executive vice president and chief financial officer.
Dana eyes new customers in India
Kamsickas added: "Oerlikon's technology will enable Dana to expand our product offerings for customers in the off-highway segment while complementing our rapidly growing portfolio of electrified product offerings for all end markets. Further, Oerlikon's manufacturing and R&D footprint enhances our ability to serve many of our current customers while connecting us with new customers, especially in India and China."
This transaction complements Dana's strategy for accelerating hybridisation and electrification and closely follows the company's acquisition of TM4, which established Dana as the only supplier with full e-Propulsion design, engineering, and manufacturing capabilities – offering electro-mechanical propulsion solutions to each of its end markets.