TRELLEBORG, Sweden--(BUSINESS WIRE)--Regulatory News:
Trelleborg (STO:TRELB) has signed an agreement to divest a facility that manufactures rubber boots for light vehicles. The business operation is based in Spain and is part of the Trelleborg Industrial Solutions business area. The buyer is the French Group Delmon Industrie S.A.
Trelleborg is active in the production of polymer boots for drive shaft (constant velocity joints) and steering systems (rack and pinion) for light vehicles. Generally, two materials are used for boots in these applications, either rubber or thermoplastic elastomer (TPE). Trelleborg supplies boots in both materials.
The market demand for TPE boots for constant velocity joints and rack and pinion is steadily increasing, while demand for rubber boots is shrinking. Trelleborg is therefore divesting its Spanish business operation that solely manufactures rubber boots for constant velocity joints. The divestment does not affect Trelleborg’s TPE boots operations.
“The rationale behind this deal is straightforward. There is an ongoing technology shift and TPE boots are rapidly gaining market share at the expense of rubber boots. We will now put more emphasis on the faster-growing part of the light vehicle boot segment. Moreover, the TPE boot segment is a niche where we have a strong global position, and we will continue to capitalize on our technology and global capabilities in this market,” says Mikael Fryklund, President of the Trelleborg Industrial Solutions business area.
“We believe a new owner of the operation is better placed to develop it and able to supplement shrinking production of rubber boots with new products, to maintain the operation in Spain,” concludes Mikael Fryklund.
Sales from the operation in 2013 amounted to approximately SEK 150 M. The transaction will only have a negligible impact on the Group’s earnings and is expected to be concluded in the third quarter of 2014.
Trelleborg is a world leader in engineered polymer solutions that seal, damp and protect critical applications in demanding environments. Its innovative engineered solutions accelerate performance for customers in a sustainable way. The Trelleborg Group has annual sales of about SEK 21 billion in over 40 countries. The Group comprises five business areas: Trelleborg Coated Systems, Trelleborg Industrial Solutions, Trelleborg Offshore & Construction, Trelleborg Sealing Solutions and Trelleborg Wheel Systems. In addition, Trelleborg owns 50 percent of TrelleborgVibracoustic, a global leader within antivibration solutions for light and heavy vehicles, with annual sales of approximately SEK 15 billion in about 20 countries. The Trelleborg share has been listed on the Stock Exchange since 1964 and is listed on NASDAQ OMX Stockholm, Large Cap. www.trelleborg.com
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