KKR & Co to buy Hyperion from Sweden's Sandvik

US private equity firm KKR & Co LP yesterday struck a deal to buy industrial tool components manufacturer Hyperion from Sweden's Sandvik, for 4 billion Swedish crowns ($471.6 million).

This is KKR's first acquisition of a small company in the industrials sector and is being funded through KKR's $13.9 billion Americas XII Fund.

KKR said that it will staff to keep their stake in Hyperion as it believes its helps to improve profitability.

Based in Fair Lawn, New Jersey and employing around 1,400 people, Hyperion is a global provider of manufacturing products using cemented carbide, cubic boron nitride and synthetic diamond.

Hyperion's role in the tool-making value chain is to transform raw materials into tool components which are later used and completed by manufacturers. It also supports engineered products by supplying finished gears or capital goods such as bearings or rotary cutters.

"Hyperion is known for its high-quality, effective products and has a loyal customer following. We see tremendous opportunity to help support the growth of the company and its customers by establishing the business as a standalone entity,'' said Pete Stavros, member of KKR and head of KKR's Industrials investment team.

''As we have done with our other industrials investments, we plan to implement a broad-based employee engagement model upon closing the transaction to ensure all employees have a stake in the success that lies ahead," he added.

Over the last six years, KKR's Industrials team has focused on employee engagement as a key driver in building stronger companies. The centerpiece of the strategy has been to make all employees owners in the business by granting them the opportunity to participate in the equity return directly alongside KKR.

"I'm pleased that we have found a new owner who will support Hyperion's continued development. This agreement is an important step in focusing Sandvik on its core businesses. The divestment creates additional capacity for growth and expansion for the core business of Sandvik," said Björn Rosengren, president and CEO of Sandvik.