Business performance
The KION Group substantially improved its competitive position in 2016 by making targeted strategic acquisitions.
On 1 November 2016, the KION Group successfully completed its takeover of Dematic, a leading specialist in automation and supply chain optimisation. The purchase consideration for 100 per cent of the shares in Dematic came to €2.2 billion. The acquisition was financed with a bridge loan that had been arranged with a number of banks beforehand. In July, a capital increase generated gross proceeds of around €459.3 million, which have already been used to reduce the amount that the Group needed to draw down under the bridge loan. In this corporate action, the pre-emption rights of the existing shareholders were disapplied and KION GROUP AG increased its share capital by 10.0 per cent for cash, fully utilising the available authorised capital. All 9,890,000 new shares were placed at a price of €46.44 each, which was determined by means of an accelerated bookbuilding process for institutional investors. Weichai Power, the anchor shareholder of KION GROUP AG, acquired 5,934,000, or 60.0 per cent, of the new shares. Institutional investors bought the remaining shares in the accelerated bookbuilding process.
Back in March 2016, the KION Group expanded its capabilities in the provision of automated warehousing systems by acquiring Retrotech, a company based in North America. Retrotech is a subsidiary of Egemin US and therefore, like Dematic, forms part of the new Supply Chain Solutions segment. The purchase consideration amounted to approximately €25.0 million.
STILL EMEA acquired its Norwegian dealer Roara AS, thereby strengthening its market position in Scandinavia. All the operating activities in that region are now brought together in the company STILL Norge AS. In Portugal, STILL has pooled its activities by establishing a separate presence in the country and is making use of the sales and distribution structures provided by the Spanish company STILL S.A.U. Customers are benefiting from new products, for example in the areas of automation, software solutions and intralogistics services, and are being offered comprehensive local customer relationship management.
At the beginning of 2016, the KION Group also opened a new plant near the Czech town of Stříbro close to Plzeň. The plant has the capacity to produce 12,000 warehouse trucks a year and operates as a smart factory based on digitally connected systems. Initially, the facility will build reach trucks for the Linde brand.
In addition, LMH EMEA has opened a new spare parts distribution centre, again in the Czech Republic, in the city of Brno. LMH EMEA is therefore also continuing to expand its service activities in the fast-growing market of central and eastern Europe.
In Brazil, the premium brands STILL and LMH have responded to the market contraction by merging their sales and distribution operations. This is helping the KION brands not only to benefit from a fall in fixed costs but also to improve their chances of gaining market share in the key South American sales market.
At the same time, the international economy brand Baoli started production at the KION plant in Indaiatuba with the aim of opening up a new market segment in Latin America. At the end of the year under review, 30 dealers were already selling Baoli trucks.