China's Shandong buys stake in Germany's Kion Group for $922 mn
31 August 2012
Germany's Kion Group today agreed to sell a stake in itself to a unit of China's Shandong Heavy Industry Group (SHIG) in a €738-million ($922 million) deal, giving the Chinese company direct access to the world's second-largest fork lift truck maker's technology.
Under the deal, Weichai Power, a leading Chinese automotive and equipment manufacturing group and part of SHIG, will invest a total of €738 million in Kion.
Weichai will invest€ 467 million to acquire a 25-per cent stake in Kion from private equity firms Goldman Sachs Capital Partners and Kohlberg Kravis Roberts (KKR), and a further €271 million for a 70 per cent majority stake in Kion's hydraulics business.
Kion said that it will use the funds to further strengthen its capital structure. Goldman Sachs and KKR will retain their existing investment in Kion and will not receive any proceeds from this transaction.
In the event of a future IPO of Kion, Weichai has the option to increase its stake in Kion to 30 per cent and has the right to further increase its stake in Kion's hydraulics business.
Founded in 1904, Wiesbaden-based Kion is the world's second-largest fork lift truck maker after Toyota industries, and markets its products under the Linde, Still, Fenwick, OM, Baoli, and Voltas brands in more than 100 countries.