Part of action program announced within Trelleborg Automotive in Europe
As part of Trelleborg’s strategic and operational action program within the Trelleborg Automotive business area, Trelleborg has entered an agreement in principal to divest its operations in Coventry, UK, which belong to Trelleborg Automotive UK. The operations will be taken over by the company’s management.
The operations conducted in Coventry are a part of the AVS business and mainly comprise the production of airsprings. The operation has approximately 110 employees. It generated sales of about SEK 150 M in 2006 and reported a loss. Trelleborg acquired the business as part of the acquisition of BTR, Invensys’ anti-vibration systems, in 2000.
“This is an additional step in the Group’s efforts to optimize the portfolio and to concentrate on selected segments,” says Roger Johansson, Business Area President of Trelleborg Automotive. “We regard this as an excellent solution. This operation is not part of Trelleborg’s core business, it has few synergies with our remaining activities and is limited in size. The transaction will enable us to further focus our automotive operations, at the same time as the business conducted in Coventry will now have an opportunity to grow within its particular area.”
From Trelleborg’s viewpoint, it is estimated that the divestment will result in a capital loss of approximately SEK 95 M before taxes. The sale is expected to have a positive impact of about SEK 15 M on cash flow.
The divestment requires fulfillment of certain conditions as well as negotiations with the employees’ representatives. Takeover will occur during the fourth quarter of 2007.