Diversified industrial group thyssenkrupp has confirmed the sale of its mining technologies business unit to mining engineering, equipment and service solutions company FLSmidth.
The sale of the enterprise, valued at €325-million, is an important milestone in the realignment of the thyssenkrupp group of companies.
The transaction is subject to competition authority approval, with the closing of the transaction expected within the next 12 months.
As background, thyssenkrupp allocated the mining business to the multi-tracks segment in October 2020 to find a new owner.
With the sale of the 3 400-employee-strong business, thyssenkrupp is successfully divesting the first major portfolio company in this segment.
The business unit generated sales of about €800-million in fiscal year 2019/20.
Through the sale, thyssenkrupp aims to transform the company into a high-performing group of companies with independent businesses, a lean holding company and a focus on systematic performance improvement across all businesses.
thyssenkrupp CEO Martina Merz says the successful sale of the mining business shows that thyssenkrupp is pressing ahead at “full speed” with the transformation of the group, and achieving important results step-by-step.
“But we have not yet reached our goal. The principle ‘performance first’ continues to apply. We need to return to positive cash flow as quickly as possible. The sale of mining technologies makes an important contribution to this,” she says.
Merz adds that she is pleased that thyssenkrupp has found a good new owner in FLSmidth. “FLSmidth presented a convincing business strategy and a clear vision for the mining business. It will give our employees attractive prospects. That was extremely important to us when negotiating the sale,” she says.
FLSmidth CEO Thomas Schulz says thyssenkrupp’s mining business is an ideal addition for FLSmidth. “We are particularly impressed by the capabilities, expertise and reputation of the thyssenkrupp employees, especially in projects and products.”
He adds that the large global installed base offers great potential for the service and aftermarket business.
“We have similar business models, share a strong focus on sustainability and digitalisation and our corporate cultures are a good match. As a result, I am very much looking forward to combining our strengths.”
Schulz says he is convinced that, together with the new mining business, FLSmidth will play a significant role in shaping a zero-emission future for the mining industry and in creating sustainable growth for its customers, employees and shareholders.
Meanwhile, thyssenkrupp is also making progress with other portfolio companies in the multi-tracks segment, whereby it is in discussions with several potential buyers for the stainless steel plant in Ternim, Italy, including the associated distribution organisation. In the case of infrastructure, the sales process is at an advanced stage, thyssenkrupp reports.
However, a sale of companies or operations has not been possible in all cases, with thyssenkrupp’s multi-tracks division deciding to wind down its heavy plate and carbon components units, instead.