DGAP-News: SAF-Holland SA

SAF-HOLLAND acquires trailer axle and suspension system manufacturer York Transport Equipment (Asia) Pte. Ltd.
 

- Acquisition to rapidly expand company's position in the fast-growing APAC/China transportation markets

- SAF-HOLLAND set to become one of the market leaders in trailer axle and suspension systems in India

- Sales contribution of around EUR 50 million expected in the first full year following the acquisition

Luxembourg, March 21, 2018 - SAF-HOLLAND is significantly expanding its presence in the growing Indian transport market and is acquiring 100% of the shares in York Transport Equipment (Asia) Pte. Ltd. ("York"), headquartered in Singapore. York and its subsidiaries ("York Group") are one of the leading suppliers of trailer axle and suspension systems in India and distribute a full range of truck and trailer components in the APAC region.
On March 21, 2018, SAF-HOLLAND GmbH signed an agreement with TRF Singapore Pte. Ltd. and TRF Holdings Pte. Ltd. for the acquisition of the axle and suspension system manufacturer York Transport Equipment (Asia) Pte. Ltd. ("York"). TRF Singapore Pte. Ltd. and TRF Holdings Pte. Ltd. have approved the sale of 100% of the shares held in York to SAF-HOLLAND GmbH. The purchase price for the stake in York, including all liabilities, amounts to around EUR 33 million. SAF-HOLLAND is financing the acquisition fully from its existing cash on hand. In the first twelve months after completion of the acquisition, SAF-HOLLAND anticipates a contribution to SAF-HOLLAND Group sales of around EUR 50 million with an adjusted EBIT margin in the mid-single-digit percentage range. Over the next few years, as the York Group becomes integrated into the Group, the EBIT margin is expected to move successively higher in the direction of the overall EBIT margin for the Group. Completion of the transaction is subject to the approval of shareholders of TRF Limited, the parent company of TRF Singapore Pte. Ltd. and TRF Holdings Pte. Ltd. Closing of the transaction and the subsequent inclusion in SAF-HOLLAND Group's scope of consolidation is expected for the second quarter of 2018.
The York Group has a strong market position in the APAC region, particularly in the heavy duty segment (> 9 tons) for trailer axles and mechanical suspension systems. York is also one of the main suppliers in India for semi-trailers' spare parts and accessories. The York Group operates major production sites in Pune, India, and Qingdao, China, and supplies most of the major truck and trailer manufacturers in the region. Next to India, the York Group also has significant operations in other fast-growing Southeast Asian markets, such as Thailand, Indonesia and Vietnam besides Australia. This geographical positioning complements the regional presence of the SAF-HOLLAND Group. Over the past few years, the York Group has built a strong service and spare parts network in India with more than two hundred service points. This network will effectively strengthen the aftermarket business of the SAF-HOLLAND Group in the region.
 

SAF-HOLLAND CEO Detlef Borghardt sees significant potential: "Following the takeover of the Brazilian company KLL in 2016 and most recently of V.Orlandi in Italy, the acquisition of the York Group is yet another step towards our targets under our 2020 growth strategy. We will become one of the market leaders in India, one of the fastest growing transportation markets in the world, almost overnight. This will also allow us to position ourselves early on for the foreseeable changes in many of these markets towards more technologically sophisticated solutions. We expect the load and safety regulations in other APAC countries to be tightened gradually over the next few years - similar to what we are currently seeing in China. Based on its product portfolio, SAF-HOLLAND is well-equipped for the upcoming changes."
 

Alexander Geis, President of the region EMEA/I, adds: "At the same time, the acquisition of York will contribute significantly towards strengthening our position in the Mid-East and Africa as well."
 

SAF-HOLLAND CFO Dr Matthias Heiden explains: "The York Group will make a positive contribution to the Group's earnings already in the first year following the acquisition. We will immediately integrate the company into SAF-HOLLAND Group's structures. We are confident that we will be able to develop the adjusted EBIT margin closer to the Group average within a few years by realizing synergies and taking advantage of cross-selling opportunities. With this in mind, we believe that we have made not only a strategically outstanding investment but also one that is financially attractive."
 

With the York acquisition, SAF-HOLLAND is continuing to increase its footprint outside of the existing core markets of Europe and North America. Only recently, the Company announced the establishment of a new production center on more than 46,000 square meters in Yangzhou, China, which is scheduled to commence operations in the first half of 2019.
 

About SAF-HOLLAND:
SAF-HOLLAND S.A., located in Luxembourg, is the largest independent listed supplier to the commercial vehicle market in Europe delivering mainly to the trailer markets. With sales of approximately EUR 1,140 million in 2017, the Company is one of the world's leading manufacturers and suppliers of chassis-related systems and components primarily for trailers, trucks, buses, and recreational vehicles. The product range comprises axle and suspension systems, fifth wheels, kingpins, and landing gear marketed under the brands SAF, Holland and Neway. SAF-HOLLAND sells its products to Original Equipment Manufacturers (OEMs) on six continents. The Group's Aftermarket business supplies spare parts to the service networks of Original Equipment Suppliers (OES), as well as to end customers and service centers through its extensive global distribution network. SAF-HOLLAND is one of the few suppliers in the truck and trailer industry that is internationally positioned in almost all markets worldwide. With the innovation campaign SMART STEEL - ENGINEER BUILD CONNECT, SAF-HOLLAND combines mechanics with sensors and electronics and drives the digital networking of commercial vehicles and logistics chains. More than 3,500 committed employees worldwide are already working today on the future of the transportation industry.
 

About York:
York Transport Equipment (Asia) Pte. Ltd. and the York Group of Companies manufacture trailer axles, assemble trailer suspension kits and distribute a full range of truck and trailer components. York's origin in the Asia-Pacific can be traced back to 1985 when York Australia was set up in Melbourne to gain a foothold in the Australian market for truck and trailer. York Singapore, known as York Transport Equipment (Asia) Pte. Ltd., Singapore, was subsequently formed in 1989 as a base to expand into the fast growing Asia-Pacific region. York is a subsidiary of TRF Ltd., India.