Valmet, a developer and supplier of process technologies, automation and services for the pulp, paper and energy industries, entered into an agreement on 14 July 2023, to acquire the Process Gas Chromatography business of Siemens AG. The value of the acquisition is 102.5 million Euros on a cash and debt-free basis. The acquisition is estimated to be completed on 1 April 2024 upon completion of carve-out measures and closing conditions, the company said. The Siemens deal comes close on the heels of Valmet acquiring Körber Group’s Business Area Tissue in June.
Siemens process gas chromatography
The Process Gas Chromatography business of Siemens AG is a market leader with its Maxum II gas chromatograph platform, systems integration, and customer services offering. Gas chromatographs are used to measure the chemical composition in gases and evaporable liquids in all stages of production. With deep customer process knowledge in chemicals, liquefied natural gas (LNG), refining and biofuels, the business provides critical process insights to support its customers in ensuring and improving quality, sustainability, and safety worldwide.
In 2022, the net sales of the business amounted to approximately 120 million Euros and pro-forma adjusted EBITDA margin was approximately 10%. The business employs around 300 people, and its main locations are in the USA, Germany, and Singapore.
The acquisition will further strengthen Valmet’s automation segment and process automation offering with process industry gas chromatograph and process analyzer systems offering. It also strengthens Valmet’s automation systems business footprint in North America, Asia-Pacific, and Europe.
Valmet and Siemens will work closely together over the coming months to ensure a smooth transition. The acquired business is planned to be integrated into Valmet’s automation systems business line as a separate business unit.
“Siemens’ Process Gas Chromatograph Maxum II products, systems and services offering complements well Valmet’s existing automation offering, industry reach and expertise. The Maxum brand is widely known in process industries and the products are used extensively by world’s leading industrial customers. Also, the large installed base provides further service opportunities and business stability. The business is planned to form a globally-lead business unit within the automation systems business line and has a joint customer base also with Valmet’s flow control business line. With this setup, supported by Valmet’s strong functions, we see opportunities for further profitable growth in this business. We look forward to welcoming the new colleagues from Siemens to Valmet,” says Emilia Torttila-Miettinen, president, Automation Systems business line.
“Today marks a new chapter in our 60-plus-year history of providing world-class gas chromatography products, solutions, and services to process industry customers around the world. By joining the Valmet team, we are excited to be partnering with an organization that shares many synergies with our Gas Chromatography and Integration business and a clear focus on employees and customers. We all are looking forward to exploring the many positive opportunities this partnership can bring going forward,” says Glen Irving, CEO, Siemens Gas Chromatograph & Integration Business.
Valmet has in recent years successfully expanded its automation segment through the merger with Neles in April 2022 and the acquisition of NovaTech’s Process Solutions business in January 2023.
Acquires Körber’s Business Area Tissue
In another acquisition on July 7, 2023, Valmet had entered into an agreement to acquire Körber Group’s Business Area Tissue. The Business Area Tissue specializes in innovative converting and packaging technologies and services for the tissue industry.
By combining the complementary offering and competences of Valmet and the acquired business, Valmet created the markets’ widest technology, automation and services offering for the growing tissue industry covering the entire tissue value chain. Growth in tissue demand is driven by several favourable trends such as increased hygiene awareness and standards of living.
Körber’s Business Area Tissue offers process technologies and related services for converting the jumbo reels of tissue paper into final tissue products for consumers and the Away from Home segment. It has the broadest offering in the tissue converting industry with converting lines for tissue rolls and for folded tissue including product packaging, as well as services and digital solutions.
In 2022, Körber’s Business Area Tissue’s net sales amounted to EUR 305 million and its adjusted EBITDA margin was approximately 12%. The company has a strong and growing services business, which accounted for 36% of total net sales in 2022. The business employs around 1,170 employees in Italy, Brazil, the U.S., China and Japan.
The enterprise value of the acquisition is approximately EUR 380 million on a cash and debt free basis subject to ordinary post-closing adjustments. The acquisition is estimated to be completed at the earliest on November 2, 2023, subject to competition authority approvals.
Valmet estimates that the acquisition will bring sales, service and cost synergies worth of 8 million Euros by the end of 2026. The acquired business will be integrated into Valmet’s Paper business line as a separate business unit. In Valmet’s reporting, the process technology part of the business will be consolidated to Paper business line and the services part to the Services business line.
At the end of Q1/2023, Valmet had a strong liquidity with cash and cash equivalents amounting to EUR 429 million and net interest-bearing liabilities totaling 345 million Euros. Valmet’s net debt to EBITDA ratio was 0.49 and gearing 15%.
Pasi Laine, president and CEO of Valmet said Valmet will have the broadest offering and unrivaled technology leadership in the global tissue markets
“Valmet benefits from the growing demand for bio-based products globally. With this acquisition, Valmet takes again a new step forward and strengthens both its Process Technologies and Services segments. The combination of Valmet’s current tissue making technologies, services and automation offering and the acquired tissue converting offering and competences is a good strategic fit complementing each other and forms a strong basis to create new business opportunities and serve our customers even better. We are happy and proud to warmly welcome all the new colleagues from Körber’s Business Area Tissue to become part of Valmet.”
“Today our Business Area Tissue is a global market player. Now, joining Valmet, this is an excellent opportunity to form a unique tissue player and set the course for the future. Our Business Area Tissue will be able to further expand its potential, offering and reach with Valmet as its committed new owner,” says Stephan Seifert, CEO, Körber Group.
