Doughty Hanson to acquire wind turbine brakes maker Svendborg Brakes for €460 million
28 June 2008
London-based independent private equity firm Doughty Hanson & Co says it is acquiring Danish industrial brakes maker Svendborg Brakes A/S for €460 million, for which it had submitted the highest bid at an auction conducted by Danske Markets.
Doughty Hanson will acquire the entire shareholding of Denmark-headquartered Svendborg Brakes, which has has operations in 15 countries, from its two entrepreneurial owners, Jans Truve and Erik Skjaerbaeck, who bought the business in a management buyout a decade back.
Headquartered in Vejstrup, Denmark, Svendborg Brakes is a global provider of braking solutions to the wind, mining, crane and offshore oil industries. It currently supplies many of the world's largest wind turbine manufacturers in Europe, the US and Asia, where it established a new facility in China in 2007.
Germany's Siemens AG and Denmark's Vestas A/S are the twogest winf turbine makers based in Denmark.
The wind turbine industry is currently undergoing huge growth globally, driven by a combination of rising demand for renewable energy, increased public awareness of climate change, and political agendas aimed at decreasing dependency on oil. It is estimated that demand for wind energy will increase at a rate of around 20 - 25 percent a year until 2020.
"Wind energy is one of the fastest developing sectors in the alternative energy space and is expected to see unprecedented growth globally in the coming years," said Jan Amethier, a senior principal who heads Doughty Hanson's private equity activities in the Nordic region. "In line with this, Svendborg Brakes has achieved a phenomenal increase in revenues in the past few years, more than doubling its annual turnover between 2005 and 2007. We believe its position and reputation for supplying high-quality products leaves it well placed to take advantage of continued growth in the renewable energy and other sectors. We are backing an experienced management team with a proven track record and this, combined with the clear market opportunity, makes it a highly attractive acquisition."
Svendborg Brakes' CEO Martin Rambusch added, "We have successfully built up our business over the past few years both in Europe and, more recently, in emerging markets such as China. This acquisition by Doughty Hanson will enable us to accelerate our global expansion. We believe that their experience of backing founder-owned businesses, and their track record in the renewable energy sector, makes them a highly suitable partner for Svendborg Brakes as we take the business forward."
Svendborg Brakes is Doughty Hanson's second private equity investment in the renewable energy sector following its 2001 acquisition of LM Glasfiber, a leading worldwide supplier of blades for wind turbines. Since it was acquired by Doughty Hanson, LM Glasfiber has grown from a regionally focused business to a global corporation with revenues in 2007 of close to €600 million and more than 6,000 employees globally.