Trelleborg acquires business enabling further expansion in offshore oil and gas in Brazil
Through its Trelleborg Engineered Systems business area, Trelleborg has signed an agreement to acquire a business in the offshore oil and gas industry in Brazil from a subsidiary of Veyance Technologies Inc. The business focuses on specially designed oil hoses for surface and deep-sea applications for the strongly growing offshore oil and gas extraction industry in Brazil.
“This represents a step in our quest to strengthen our presence in Brazil in the offshore oil/gas industry,” says Lennart Johansson, President of the Trelleborg Engineered Systems business area. “The acquired operation complements our current technology in oil hoses and is thus an excellent addition to our product portfolio, globally as well as in Brazil. Our customers are moving more and more of their production to Brazil and it is crucial to ensure that we have manufacturing close to their units.”
The plant is located in Santana de Parnaiba, close to São Paulo. Trelleborg will take over the lease on the facility, which is 15,000 m2, acquire the existing equipment and assume responsibility for the some 100 employees. The seller is Veyance Technologies do Brasil Produtos de Engenharia Ltda.
The acquisition is expected to be finalized in the first quarter of 2011, and will be followed by investments in supplementary production equipment. It is anticipated that production can commence gradually as of the second half of 2011. The purchase consideration is approximately SEK 40 M and Trelleborg will initially invest approximately SEK 25 M during 2011. A successive positive earnings effect is forecast from the second half of 2012.
Trelleborg has reported significant sales in the oil/gas industry in Brazil for a long time now and, in November 2010 the Group announced an investment in a new facility in Macaé, north of Rio de Janeiro, for the manufacture of such items as subsea buoys for deep-sea applications. In recent years, large deposits have been discovered off the coast of Brazil and, by 2014, Brazil is forecast to be the largest market in the world for the products and solutions that Trelleborg offers.
The Trelleborg Group currently has 1,000 employees in Brazil and is established in technology development, production and sales in the country.