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Dutchi deal boosts Regal Beloitís European presence

01 October, 2008

The US motor manufacturer Regal Beloit is buying the Netherlands-based motor distributor, Dutchi Motors, for around $34m in cash and the assumption of $3.2m in liabilities. The deal follows Regal Beloitís $27.6m purchase earlier this year of the Chinese motor-maker Hwada, which is a key supplier to Dutchi.

Dutchi, which claims to be Europeís largest stockist of LV motors, is expected to generate $70Ė75m of income for Regal Beloit in 2009.

Regal Beloitís chairman and CEO, Henry Kneuppel says he is "very excited" about the purchase and describes Dutchi as "a strong and growing business across Eastern and Western Europe, South Africa, Russia and the Middle East.

"With Dutchi joining our expanding family," he says, "we will now have in place the infrastructure necessary to significantly expand our commercial efforts in these critical regions. The company has an outstanding management team that has continuously grown the business at a multiple of market growth rates.

"Given this track record and the opportunities that RBC can bring to Dutchi, we are very confident that we will see accelerated growth across these regions, even in light of the short-term prospects for Western Europe," Kneuppel adds. "We have for some time searched for a commercial infrastructure in these important geographical regions that would allow us to leverage our global manufacturing platform. Dutchi is a perfect fit to complete this portion of our globalisation strategy."

Regal Beloit has been expanding aggressively in recent years. Last year it bought the fractional horsepower motor manufacturer, Morrill Motors as well as Alstomís Indian motors and fans business. It also paid $220m for the Fasco motors business once owned by Invensys.

Dutchi motors

Dutchi sells motors in ratings from 0.06Ė630kW which are made to its designs by manufacturers in China and Eastern Europe. Its origins were as a trade organisation called Peja that bartered with Eastern Europe during the Communist era and imported VEM motors from East Germany. When the EU implemented protectionist policies in the 1980s, it started to assemble motors for VEM in the Netherlands. Following the collapse of the Communist bloc, Peja transformed itself into a motor distributor.

Dutchi motors are sold in the UK by Birmingham-based Camis Motors & Drives.




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