Neles specialises in the manufacture of valves Photo: Neles
Alfa Laval is making a cash offer for all issued and outstanding shares in valve manufacturing specialist, Neles.
Neles is a global leader in flow control solutions and services and Alfa Laval has identified the industrial flow control market as a key growth area. The transaction will enable Alfa Laval to strengthen its presence in the large industrial flow control space where the company currently offers mainly energy efficiency solutions.
“We have a great respect for Neles and the company’s employees and leadership,” said Tom Erixon, president and chief executive of Alfa Laval. “The proposed deal offers a strong industrial logic – our businesses complement each other well with very little overlapping operations. Alfa Laval has the resources to invest in and support the development of Neles for years to come while our global service network offers Neles a ‘plug and play’ platform. As an owner, Alfa Laval would be committed to the strategy and industrial plan of Neles while offering a powerful platform to enable future growth.”
Alfa Laval purchased Aalborg in Denmark in 2011 and Frank Mohn (Framo) in Norway in 2014 as part of its diversification strategy. With this latest merger, Neles and Alfa Laval would create a larger and stronger global player in the flow control market.
The companies operate in parallel markets with different product specifications and very little overlap. However, Alfa Laval sees much in common between the industrial end-markets and the separate hygienic end-markets. The strategic fit is further enhanced by both companies having an advanced technology profile.
Neles’ board of directors recommends to shareholders that they accept the tender offer of €11.50 per share.