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GKN buys Stromag for €195m

23 September, 2011

The British engineering group GKN has bought Stromag, the German manufacturer of brakes, clutches and couplings, for €164m in cash and the repayment of debt worth €31m. Stromag will be integrated into GKN’s Land Systems division, which produces shafts, wheels, clutches, gearboxes, linkage systems, driveline components and vehicle structures.

GKN is acquiring privately owned Stromag from its shareholders which include its management, and the investment company Equita, which bought a controlling stake in Stromag in 2007.

Stromag, founded in 1932, specialises in industrial power management components, with an emphasis on tailoring systems to its customers’ requirements. Its core products include hydraulic clutches, electromagnetic brakes, flexible couplings, and gear-cam limit switches. The business has its headquarters in Unna, Germany and has operations in Germany, France, the US, Brazil, India, China, as well as a UK subsidiary in Rushden, Northamptonshire.

In the year to December 2010, Stromag reported sales of €111m, EBITDA of €19m, profit before tax of €10m and gross assets worth €103m. Sales this year are expected to be worth around €140m.

“The acquisition of Stromag is an important step in the implementation of the GKN Land Systems’ strategy to build a global leader in industrial power management, extending our capability in electromechanical components,” says GKN executive director, Andy Reynolds. “In combination with our existing business, it will provide a strong platform to accelerate growth in existing markets, together with access to a number of attractive new industrial segments, including renewable energy.”

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