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Belden buys Hirschmann for $260m to expand into signalling

20 January, 2007

The US cabling giant Belden is buying Germany`s Hirschmann Automation and Control (HAC) from its venture capital owner, HgCapital, for around $260m cash plus obligations, including pension liabilities, worth a further $60m. The acquisition will expand Belden`s activities beyond cabling into signal transmission equipment.

"In addition to having a broad portfolio of connectors for the industrial market, Hirschmann is the undisputed leader in the application of industrial Ethernet solutions" says Belden`s president and chief executive, John Stroup. "We couldn`t be more excited to have Hirschmann as part of the Belden family."

Hirschmann, founded in 1924, had sales last year worth around $250m. It employs some 750 people and has two production sites in Germany, as well as three manufacturing joint ventures in China. Its product range includes network components for Ethernet, Fast Ethernet and Gigabit Ethernet, optical fibre interfaces for field bus systems, actuator and sensor connectors, and systems for load indication and load moment limitation. The company claims to be the global market leader for rail-mounting industrial Ethernet devices.

HgCapital acquired Hirschmann in February 2004 as part of a management buyout. Since then, two non-core subsidiaries have been sold and improvements have been made to the group`s efficiency. A new structure has been established with two separate companies: HAC; and Hirschmann Car Communication, which is not part of the Belden transaction. HAC`s chief executive, Reinhard Sitzmann, will continue in his role.

"In the short run," says Stroup, "we see a tremendous opportunity to use Belden`s global reach to accelerate HAC`s revenue growth in North America and Asia. In the long run, we expect to thoughtfully integrate the capabilities of Hirschmann and Belden to create products and services for the industrial market that are preferred worldwide."

Hirschmann`s Sitzmann sees Belden and HAC as having "highly complementary products and sales positions. Belden will be able to strengthen HAC`s market presence in North America and Asia. We welcome this combination with Belden and look forward to a creative and dynamic future."

Belden, with annual sales worth some $1.35bn and more than 5,000 staff worldwide, supplies signal transmission products including special-purpose cables for data networking. It markets include aerospace, security and entertainment, as well as industrial.

Belden CEO John Stroup hints that there may be further acquisitions ahead. "We continue to investigate opportunities to advance our presence in emerging geographies and expand our solutions beyond copper cable," he says. Belden expects the Hirschmann acquisition to add to its 2007 earnings.




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