Belgium-based steel wire transformation and coating technologies company Bekaert and the Ontario Teachers Pension Plan — the previous owner of wire and fibre rope solutions provider Bridon — have successfully closed the definitive merger of their ropes and advanced cords businesses.
Bekaert and the Ontario Teachers Pension Plan have established a merger in which Bekaert holds 67% and Ontario Teachers 33%. The joint venture starts its merged operations under the Bridon-Bekaert Ropes Group name.
The company notes that the merger deal has satisfied all regulatory requirements and customary closing conditions, including clearance by merger control authorities in the US, the European Union (EU), Brazil, Chile, Australia, China, and South Korea.
Bridon’s previous chairperson, Andrew Caffyn, has been appointed chairperson of the board of the new company and Bekaert’s previous CFO, Bruno Humblet, has been appointed as CEO. Humblet will be replaced by Beatríz García-Cos Muntañola, the newly appointed CFO of Bekaert.
“We are proud to announce the completion of the merger. Since we released our plans, we have been through a thorough merger completion procedure and have prepared ourselves for the integration process,” comments Humblet.
He adds that the company can now focus more on the business purpose of its merger and welcome its customers, employees and shareholders to take part in its plans and ambitions.
“We are the world’s premier ropes and advanced cords solutions provider and our purpose is to create significant value over time by delivering unmatched quality and service to our customers,” he says.
Bekaert CEO Matthew Taylor comments that the merger is the result of the company’s strong belief in the benefits of creating a global ropes group that can leverage its competences and scale for the benefit of customers worldwide.
“Neither the current economic downturn in certain sectors nor the impact of Britain’s choice to leave the EU changes our belief in the opportunities for the future success of Bridon-Bekaert Ropes Group. “They have strong leadership in place and we are convinced they will make the ropes group a successful business,” asserts Taylor.
Bridon-Bekaert Ropes Group combines the ropes and advanced cords capabilities of about 2 500 employees, 19 manufacturing entities across 11 countries, market-focused research and development and a global sales and services network.
Further, the company details that the combination of the businesses will leverage the scale and complementary strengths of Bekaert and Bridon and allow it to pursue value creation for customers and for the new group.
Bekaert offers its advanced cords business and a well-established ropes presence in Latin America, Canada and Australia, while Bridon holds strong positions in Europe and the US with a portfolio of rope wire, strand, and steel and synthetic ropes.
Bridon-Bekaert points out that the merger will also create opportunities for further growth in Asia. The merger creates the leading ropes group in the world, with about $650-million in sales (€580-million) on a yearly basis in a normalised business context.
The financial results of Bridon-Bekaert Ropes Group will be included in the consolidated statements of Bekaert. The transaction is estimated to add about $350-million (€315-million) to Bekaert’s consolidated sales on an annual basis in a normalised business context.
The group projects a lower run rate over the first two years, owing to the current demand instability in oil and gas and the mining markets.