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Bridon-Bekaert Ropes Group begins business
Bekaert, world market and technology leader in steel wire transformation and coating technologies, and Ontario Teachers' Pension Plan, the previous owner of Bridon, have successfully closed the definitive merger of their ropes and advanced cords businesses.
Andrew Caffyn, previously Chairman of Bridon, has been appointed Chairman of the Board of the new company. Bruno Humblet, previously Chief Financial Officer of Bekaert, has been appointed CEO. Bruno will be replaced by Beatríz García-Cos Muntañola, the newly appointed CFO of Bekaert.
The merger deal, announced on 7 December 2015, has satisfied all regulatory requirements and customary closing conditions, including clearance by merger control authorities in the US, EU, Brazil, Chile, Australia, China, and South Korea. Bekaert and Ontario Teachers' have established a joint venture in which Bekaert holds 67% and Ontario Teachers' 33%. The joint venture starts its merged operations today under the Bridon-Bekaert Ropes Group name. Bridon-Bekaert Ropes Group combines the ropes and advanced cords capabilities of approximately 2 500 employees, 19 manufacturing entities across 11 countries, market-focused R&D, and a global sales and services network. The combination of the businesses will leverage the scale and complementary strengths of Bekaert and Bridon and will pursue value creation for customers and for the new group.
Bekaert is contributing 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 USA with a portfolio of rope wire, strand, and steel and synthetic ropes. The merger will also create opportunities for further growth in Asia.
The merger creates the leading ropes group in the world with approximately USD 650 million in sales (current equivalent of € 580 million) on an annualized basis in a normalized business context. The financial results of Bridon-Bekaert Ropes Group will be included in the consolidated statements of Bekaert as from today. The transaction is estimated to add approximately USD 350 million (€ 315 million at current rates) to Bekaert's consolidated sales on an annual basis in a normalized business context. The Group projects a lower run rate over the first two years due to the current demand instability in oil and gas and mining markets.
Bruno Humblet, CEO of Bridon-Bekaert Ropes Group: "We are proud to announce the completion of the merger. Since we released our plans in early December 2015, we have been through a thorough merger completion procedure and have prepared ourselves for the integration process. We can now entirely focus on the business purpose of our merger and we welcome our customers, employees and shareholders to take part in our plans and ambitions. We are the world's premier ropes and advanced cords solution provider and our purpose is to create significant value over time, by delivering unmatched quality and service to our customers."
Matthew Taylor, CEO of Bekaert: "On behalf of Bekaert and of Ontario Teachers', shareholders of Bridon-Bekaert Ropes Group, I wish the group a lot of success in achieving their ambitions. The merger is a result of
our strong belief in the benefits of creating a global ropes group which can leverage its competencies and scale for the benefit of customers worldwide. Neither the current economic downturn in certain sectors or the impact of Britain's choice to leave the European Union, change our belief in the opportunities for 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."