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Beijer Electronics buys Westermo for SEK215m
Published:  21 December, 2007

The Swedish HMI and automation supplier Beijer Electronics has bought another Swedish company, the industrial communications specialist, Westermo, for SEK215m (£16.8m). Beijer’s president and CEO, Göran Sigfridsson, describes the acquisition as "a strategic milestone" in Beijer’s development.

"Westermo’s broad product range and high organic growth complements and enhances Beijer Electronics’ automation offering for industrial and infrastructure," he adds.

Westermo, founded in 1975, develops products such as Ethernet switches, routers, fibre optic modems, and wireless communications. Its 2007 sales amounted to SEK225m (£17.6) and it has been expanding at an average of 17% a year for the past decade. It is estimated to have about 5% of the global market for industrial communications, with 90% of its sales coming from Europe (including 20% from the Nordic region). The previously family-owned Westermo, which employs 148 people, has subsidiaries in the UK, Germany, France and Singapore, and a factory in Stora Sundby, west of Stockholm.

Westermo Beijer deal

Westermo will operate as an independent business within Beijer Electronics. Its management will keep their positions, with Lars-Ola Lundqvist staying on as CEO. Westermo’s former owner, Thomas Andersson (shown above, right, with Sigfridsson) will have no involvement with the business in future. The acquisition is expected to have a positive impact on Beijer’s earnings per share in 2008.

"Data communications are becoming a more important part of the automation solutions in manufacturing and infrastructure projects," Sigfridsson remarks. "That’s why we anticipate yearly growth of 15-20% in industrial communications, and especially in the industrial Ethernet segment, where Westermo has a strong product offering. At the same time, many customers want to deal with fewer, but larger, vendors of total solutions. So with the acquisition of Westermo, Beijer Electronics is sharpening its overall competitiveness."

Beijer and Westermo largely target the same customers with complementary products, so the short-term benefits will come mainly from co-ordinated sales. In the longer term, the benefits will extend to procurement, product development and production.

Beijer, founded in 1981, has around 450 employees and global sales worth around €100m. It has two businesses: Electronics Products, which handles its HMI operations, and Automation, which focuses on the Scandinavian region and has 18-20% of the automation market in Sweden and Norway. In 2005, Beijers acquired the Taiwanese HMI manufacturer, Hitech Electronics.

In 2006, Mitsubishi Electric took a 15% stake in Beijers’ Automation business and transferred its Danish and Baltic agencies to Beijers. These agencies are expected to generate an income of around SEK100m (£7.8m) for Beijers this year.

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