Nippon Steel & Sumitomo Metal Corporation (NSSMC), one of the world's largest steel producers, has signed an agreement with funds advised by Triton to acquire 100 percent of Ovako Group. The acquisition is subject to regulatory approval.
NSSMC is a global market leader in steel production with world-leading technologies and manufacturing capabilities. The group makes a wide range of value-added steel products in more than 15 countries as well as at 12 steelworks in Japan. For the fiscal year ended March 31, 2016, NSSMC reported a crude steel production on a consolidated basis of 45 million tons.
“Ovako is a global technology leader regarding high-cleanliness steel for bearing steel and other advanced applications”, says Kosei Shindo, President of NSSMC. “Our goal with the acquisition of Ovako is to strengthen and expand our global business and further strengthen our technology, product quality, and product development capability for special steel, and securing a base of manufacture and sales in Europe, to strengthen our global special steel business”.
In the past years Ovako has implemented a number of key improvement initiatives, such as clear segment strategies, increased production efficiency, employee safety programs, investments in product development, establishment of a new global sales organization and the launch of digital tools to improve the sales process. This has resulted in new business, increased market shares, higher demand from customers and improved efficiency and profitability.
“I am very pleased that Ovako now will become part of Nippon Steel & Sumitomo Metal Corporation, a strong industrial owner and a clear technology leader in the global steel industry” says Marcus Hedblom, President and CEO of Ovako. “With the strong support of our shareholder Triton, Ovako has strengthened its competitiveness and its market positon significantly over the last years. Our target is to continue to grow over the coming years, and we expect that with the support and the technological leadership of NSSMC we will be able to bring even more value to our customers”.
"Triton has been the owner of Ovako for more than seven years and it´s now an appropriate time for an industrial owner to continue the development of Ovako. We would like to thank the employees and management for their contributions to Ovako's successful development during Triton’s ownership” says Joakim Olsson, Chairman of the Board of Ovako.
The parties have agreed not to disclose the terms of the transaction. Upon closing of the transaction, it is Ovako’s intention to redeem the Ovako AB (publ) EUR 310 million 5.00 percent senior secured notes, due 2022.Source: Ovako