Trelleborg buys owner of Mitas brands, tech

Trelleborg buys owner of Mitas brands, tech

CGS Holding a.s., a privately owned company with leading positions in ag and specialty tires will be acquired by Swedish tire firm.

Trelleborg has signed an agreement to acquire CGS Holding a.s. This private company is the owner of the Mitas tire, Rubena and Savatech rubber manufacturing businesses. The total cash amounts to about $1.25 billion on a cash and debt free basis. CGS is headquartered in the Czech Republic and generated sales of about $600 million in the rolling 12 months ended 30 June 2015.

The transaction is subject to approvals from authorities in key countries and is expected to be completed in the first half of 2016.

NEW OWNER: CGS Holding, owners of several brands including Mitas Tires, is being acquired by Trelleborg, the Swedish tire maker.

In a press statement, Peter Nilsson, president and CEO of Trelleborg comments: "I am very proud to announce this highly complementary acquisition, which is a significant and attractive add-on to our existing businesses. CGS, with its strong and well performing operations in agricultural and industrial tries as well as engineered polymer solutions, will strengthen and complement Trelleborg's already leading positions in a number of existing areas."

Vera Bechynova, spokesperson for CGS Holding, adds: "Trelleborg is a trustworthy strategic partner possessing a comprehensive vision for the development of CGS Holding and we are confident that Mitas, Rubena and Savatech rubber manufacturing business will be placed in capable hands."

With the acquisition of CGS and its subsidiary Mitas, Trelleborg is establishing itself as a global leader in agricultural tires and reinforces its leading position in industrial tires. As a result of the acquisition, Trelleborg Wheel Systems will almost double its revenues, broaden its geographical reach and add new positions in complementary tire niches. Mitas is performing strongly despite the current downturn in the agricultural market. Moreover, the acquisition of CGS’s other industrial polymer businesses will enhance Trelleborg’s leading positions in several of the Group’s existing business areas.

Key facts regarding CGS Holding

CGS is a leading supplier of specialty tires and engineered polymer solutions. The company employs approximately 6,500 people, headquartered in the Czech Republic and has 13 production sites of which 11 are located in Central and Eastern Europe, one in the U.S. and one in Mexico.

The group includes the main subsidiaries Mitas, Rubena and Savatech. Mitas accounts for approximately two-thirds of group sales and has strong mid-market specialty tires brands with a strong position in agricultural tires.

Summary of additional financial information

The pro forma combined sales for Trelleborg and CGS Holding in the rolling 12-months period ended 30 June, 2015, amounted to approximately SEK $3.45 billion. The combined companies will have approximately 23,000 employees.

Source: CGS Holding

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