Funds managed by CapMan (CapMan) and Rautaruukki Corporation (Ruukki) have agreed to combine units of Komas and Ruukki’s Engineering division to form a new company through an asset deal. The new company is called Fortaco and will be Europe’s largest contract manufacturer for the mechanical engineering industry.
In 2012, Fortaco is expected to generate turnover (pro forma) of approx. €270 million and will have approx. 2,600 employees. The new company will be formed through the combination of compatible and complementary units of Ruukki and Komas. Fortaco’s customer base consists of the world’s leading engineering OEM’s, which benefit from a broader product and service offering. The company’s main products are high performing welded and machined components, ready-to-install operator cabins and fullyassembled machines and equipment.
The current CEO of Komas, Mika Kari, will become CEO of Fortaco and the management team will include members from both Ruukki and Komas. Following the completion of the transaction, CapMan will become Fortaco’s largest shareholder with a 66.5% stake in the company, while Ruukki will hold 19.0% of the company’s equity. Fortaco’s complete management team and the composition of its Board of Directors will be announced in connection with the closing of the transaction.
“We are very satisfied with this agreed transaction. The arrangement strengthens the know-how of the new company and provides it with comprehensive production capacity in Eastern Europe in addition to Finland. Fortaco will become the largest manufacturing partner for the engineering industry in Europe, which allows us to better service our international customer base”, says Mika Kari, CEO of Komas.
“When we originally invested in Komas, we envisaged building a leading contract manufacturing company in the mechanical engineering industry with the aptitude to grow and develop together with its customers. The transaction enables us to form a highly competitive company with state-of-the-art manufacturing operations in Finland, Poland, Estonia, Hungary and Slovakia. As a consequence, we are able to offer flexible and high quality services to customers both in the Nordic countries and in Continental Europe”, says Jan Mattlin, Partner, CapMan Buyout.
“This transaction is a natural progression in an industry, where contract manufacturers are expected to show efficiency and possess specific know-how and international presence. Fortaco will become the largest player in its field and it has strong design and manufacturing competence,” says Marko Somerma, Executive Vice President, Ruukki Engineering & CSO Rautaruukki Corporation. Komas will contribute its Janów Lubelski (Poland), Narva (Estonia), and Sastamala, Kurikka, Parkano and Härmä units (Finland) to Fortaco. Employees of the aforementioned units will transfer to Fortaco as old employees. Komas units in Jyväskylä will not be part of Fortaco and will continue to operate as an independent company under Komas’ current ownership. Ruukki Engineering’s units in Jászberény (Hungary), Wroclaw (Poland) and Holíč (Slovakia) together with Kurikka, Sepänkylä and Kalajoki component units (Finland) will be transferred to the new company.
The completion of the transaction is subject to approval from the competition authorities and is expected to be finalised by early December 2012.
