Sandvik to acquire PCD tools manufacturer Frezite
Sandvik has agreed to acquire 100% of Portugal-based Frezigest, SGPS (Frezite), known for its custom polycrystalline diamond tools for metal and wood applications. The acquisition aligns with Sandvik's growth strategy in machining solutions, enhancing its PCD tooling capabilities for lightweight materials. Frezite generated approximately SEK 450 million in 2021 and is expected to grow at a mid-single-digit rate. The transaction is set to close in Q3 2022, with the purchase price undisclosed. The acquisition is anticipated to have a limited yet slightly positive impact on Sandvik's earnings per share.
- Strategic acquisition enhances Sandvik's PCD tooling capabilities for lightweight materials.
- Frezite's custom tools complement Walter's product offerings, increasing competitive edge.
- Potential for adjacent revenue growth in premium wood and composite markets.
- Expected organic growth in Frezite aligns with Sandvik's long-term growth strategy.
- The EBITA margin from Frezite is slightly dilutive to Sandvik Manufacturing and Machining Solutions.
SANDVIKEN, Sweden, June 27, 2022 /PRNewswire/ -- Sandvik has signed an agreement to acquire
"With the acquisition of Frezite, we take another important step in our shift to growth strategy. We have a clear ambition for our machining solutions business to increase our presence and strengthen our expertise in PCD tooling for lightweight materials," says Stefan Widing, CEO and President of Sandvik.
Frezite enhances Walter's product offering within PCD aluminum products. The company is present in Europe, Mexico and Brazil, and with its speed to market capabilities it improves Walter's value proposition and position as a manufacturer of advanced components in lightweight materials. Frezite's competence and offering of clamping and fixtures solutions will allow Walter to offer turnkey solutions which implies interaction earlier in the customer's value chain. In addition, Frezite adds adjacent revenue potential for Walter in the premium wood and composite segment.
"Frezite provides complementary production capabilities and competence and reinforces our position in the electric and hybrid automotive market. With its solid position within custom PCD tools and competence within interesting adjacent fields, we are very pleased to welcome Frezite to the Group," says Nadine Crauwels, President of Sandvik Machining Solutions.
Frezite, founded in 1978, has around 450 employees and is headquartered in Trofa, Portugal. In 2021, the company generated revenues of approximately SEK 450 million and is expected to grow at a mid-single digit organic growth rate in the medium term. The EBITA margin is slightly dilutive to Sandvik Manufacturing and Machining Solutions. Impact on Sandvik's earnings per share will be limited, yet slightly positive. The parties have agreed not to disclose the purchase price. The transaction is expected to close during the third quarter of 2022 and is subject to customary closing conditions.
Stockholm, June 27, 2022
Sandvik AB
For further information, contact Louise Tjeder, VP Investor relations, phone: +46 (0) 70782 6374 or Johannes Hellström, Press and Media Relations Manager, phone: +46 (0) 70721 1008.
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SOURCE Sandvik
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