The Kion Group is set to become one of the leading global providers of intelligent intralogistics solutions by acquiring Dematic, a best-in-class automation provider and specialist in supply chain optimization.
It will create a true global provider with close to 30,000 employees, more than 6.7bn (US$7.6bn) in revenue for the calendar year 2015 and strong profitability with a combined adjusted EBIT margin of approximately 9.4% for this period. After deductions for certain liabilities, the Kion Group expects the purchase price for the shares to amount to approximately US$ 2.1bn, based on an enterprise value of Dematic of US$3.25 bn.
The transaction is subject to customary closing conditions and regulatory approvals and is expected to be closed in the course of the fourth quarter of 2016.
Dematic is a leading global supplier of advanced integrated automation technology, software and services to optimize supply chains and to meet the material handling automation needs of its customers. The company’s product and systems portfolio ranges from automated guided vehicles (AGVs), palletizers, storage and picking equipment including automated storage and retrieval systems, sorters and conveyors to a leading integrated software platform and automation technologies.
Dematic has been growing annually by more than 12% since 2013 and generated approximately US$1.8bn in revenue and an adjusted EBIT of US$166m during the calendar year 2015. It employs almost 6,000 skilled logistics professionals including over 3,000 engineers in software development, R&D, engineering, project management and customer service to support its customers globally, with engineering centers and manufacturing facilities located around the globe. Dematic has more than 100 locations and is present in 22 countries. The company is a leading player in the USA and Europe and across the world.
It has implemented more than 4,500 integrated systems for small, medium and large companies with business in a broad variety of industries around the globe, including the fast-growing e-commerce business.
The purchase of Dematic will establish the Kion Group as a global leader in Intralogistics 4.0. Leveraging its sales and service networks, technologies and resources, the enlarged company will be able to seamlessly offer the full material handling product and service offering to customers of all sizes in a broad range of industries across the world, from manually operated industrial trucks to complete fully automated warehouses.
The Kion Group will thus enhance its position as one-stop-supplier for intelligent supply chain and automation solutions, and is now perfectly positioned for attractive and profitable growth driven by megatrends like Industry 4.0, digitalization and e-commerce.
Both companies contribute strong complementary market positions and geographical footprint as an opportunity for revenue growth. Dematic will leverage the Kion Group’s service network and brand reputation in key markets like Europe, China and Brazil, whereas the Kion Group will take advantage of Dematic’s strong position in the USA and European automation markets in particular. This complementarity is also the source of cost synergies from this combination. Kion Group’s strong sales and service network together with Dematic’s sizeable installed base provide the basis for unlocking further revenue potential from services and systems upgrades.
In the past year, the Kion Group already started to build a strong position as provider of automated systems solutions by acquiring Egemin Automation and Retrotech, thereby making further inroads in this attractive and growing market.
“With the acquisition of Dematic we are substantially changing and enhancing what Kion Group is and does for further profitable growth in a quickly changing industry and digitalized world,” said CEO Gordon Riske. “We are becoming a unique provider of products, services and solutions. Like no other company in our industry, we can accompany every customer seamlessly on its journey to Industry 4.0 and Intralogistics 4.0, now and everywhere.”
“This transaction will be transformational to our industry. Kion Group and Dematic together will design and deliver solutions that better position our customers to respond to dynamic demand,” said Ulf Henriksson, CEO of Dematic. “With a shared vision and commitment to R&D, the combined company will continue to focus on superior customer solutions with significant investment in this area. Together, Kion Group and Dematic will jointly define a new era in material handling solutions.”
“The entire Kion Group Supervisory Board is excited about the combination of Kion Group and Dematic and is fully supportive of this landmark transaction. This marks another milestone in the implementation of the Kion Group Strategy 2020,” said John Feldmann, Chairman of the Kion Group Supervisory Board.
“Together Kion Group and Dematic will be even better able to offer their customers worldwide the best suiting products and solutions available on the market.”
After closing the transaction, Dematic will be integrated into the Kion Group forming an additional fifth operating unit, which will also comprise the businesses of Egemin Automation and Retrotech. This future Kion Group operating unit will be headed by Ulf Henriksson as its president.
June 23, 2016