Sandvik has signed an agreement to acquire 67% of Chuzhou Yongpu Carbide Tools Co., Ltd, a premium solid round tools company, with a call option to buy the remaining part in three years’ time. Chuzhou Yongpu Carbide Tools Co., Ltd is mainly focused on global and local OEMs and connected suppliers operating in China.
Its capabilities include the full solid round tools manufacturing value chain with an offer covering blanks, cutting tools, reconditioning and coating services. The company will be reported in Sandvik Coromant, a division within Sandvik Manufacturing and Machining Solutions.
Chuzhou Yongpu Carbide Tools Co., Ltd will continue to operate under its own brand and focus on developing its offer and market share with the ambition to become a leading premium provider of solid round tools in China. The combined expertise and footprint of Sandvik Coromant and Chuzhou Yongpu Carbide Tools Co., Ltd will drive further geographical expansion in the region, particularly for cutting tools.
Chuzhou Yongpu Carbide Tools Co., Ltd is headquartered in Chuzhou, China, and has around 500 employees. It had revenues of approximately SEK 400 million for the twelve month period Q2 2020 to Q1 2021, an EBIT margin slightly dilutive to Sandvik Manufacturing and Machining Solutions. Impact on earnings per share will initially be neutral.
The transaction is expected to close during the third quarter of 2021.
Courtesy of Sandvik.