Onex to sell KraussMaffei to ChemChina and investors for EUR925 mn

Following reports of an imminent sale last week http://www.plasticsandrubberasia.com/jan2016/machinery2.html, private equity firm Onex Corporation and its affiliates , the Onex Group have agreed to sell plastic processing machines manufacturer KraussMaffei Group to China National Chemical Corporation (ChemChina) for a cash enterprise value of EUR925 million. The transaction is expected to close in the first half of 2016 subject to customary closing conditions.

The Onex Group made a EUR276 million investment in KraussMaffei Group in December 2012. Upon completion of the transaction, the Onex Group will receive proceeds of approximately EU670 million; whilst, Onex’s portion of the proceeds will be approximately EUR180 million, including carried interest of EUR12 million.

Frank Stieler, CEO of KraussMaffei Group expressed his gratitude to Onex through its managing Director, David Mansell for providing support to KraussMaffei’s growth in terms of new product developments and significant investments in key geographic regions.

The deal is termed as the largest Chinese takeover of a German company.

ChemChina has been an aggressively acquiring companies in recent years. Last year, it entered into a US$7.7 billion deal to buy Italian tyre maker Pirelli.

The group of investors acquiring KraussMaffei includes Asian/European private equity firm AGIC Capital and Chinese state fund Guoxin International Investment Corp. as well as ChemChina, according to a statement from AGIC Capital.

The deal is the first for AGIC Capital, a new private equity fund established by former Deutsche Bank Group AG banker Henry Cai. The fund is raising US$1 billion to buy businesses in German-speaking countries with the aim of growing their China business by joining up with local Chinese industrial companies who can use their technology.

AGIC says it will work closely with other shareholders and KraussMaffei Group’s management to support the company’s expansion in Asia.

“KraussMaffei Group’s developments in new materials such as carbon fibres stand to benefit from China’s objective to advance its industry towards high-end manufacturing,” explained AGIC’s Head of Germany, Wolfgang Seibold.

“We are proud to be part of the largest ever Chinese direct investment in a German company and help KraussMaffei Group build a bridge into the China market. We are looking forward to working with the outstanding management team of KraussMaffei Group to realise our joint growth ambitions,” he said.