Fives Completes Acquisition of MAG Americas
September 13, 2013
Within the last 12 months, Fives has significantly strengthened its global leadership position through three strategic acquisitions. Recently, Fives has completed the acquisition of MAG Americas. With this acquisition, the company becomes one of the global leaders in high-precision machine tools used to manufacture large, complex equipment and high-performance composite processing machines. The acquisition includes three MAG brands: Cincinnati, Giddings & Lewis, and Forest-Liné.
“The technological expertise gained through the acquisition of MAG Americas is key to successfully support and achieve the innovation strategies and requirements of our major customers. Acquiring MAG Americas fits well with the growth strategy of Fives,” said Frederic Sanchez, president of the executive board of Fives.
“It allows us,” he said, “on one hand, to acquire a leading position in the technology of composite materials, which is anticipated to have a bright future in many industrial sectors. Secondly, it enables us to achieve our global ambition to design and manufacture key production equipment and machines for leading industrial sectors such as aerospace, heavy equipment, and energy. Strong brands such as Cincinnati, and all the related patents acquired from the MAG Group, are very complementary to our portfolio of businesses and technologies. In addition, the acquisition strengthens our global presence. It provides us with new opportunities in emerging markets and a greater footprint in the United States.”
This acquisition strengthens Fives’ global position. One thousand MAG Americas employees, based in the U.S., France, Canada, China, Korea and, Russia will join the 6,500 Fives employees in 30 countries. In 2012, MAG Americas achieved a turnover of approximately $400 million, 67% of which was achieved in the U.S. Since the beginning of the year, Fives also has strengthened its position in the high-value added steel sector.
In January 2012, Fives acquired Keods, a company specializing in high-level consultancy in metallurgy and focused on improving the quality of flat carbon steel products, a crucial process for the development the product mix of global steel manufacturers, especially when it comes to serving the needs of the automotive industry. Additionally, Fives signed a contract in July 2012 to acquire OTO Mills— an Italian manufacturer of production lines for welded steel tubes and automation systems for the steel industry. OTO Mills employs 250 engineers and technicians. In 2013, it is expected to achieve a turnover of about $120 million, half of which is through sales in North and South America. OTO Mills’ focus on technological innovation has enabled it to become a world leader in electric resistance welding (ERW) lines and to offer a wide range of production equipment of steel pipes of diameters ranging from 1/4” to 24”, used in many industrial applications, including in the oil and gas industry.
OTO Mills also has extensive expertise in automation, enabling higher levels of reliability and productivity within production processes. This automation expertise is a major asset, which, like the expertise provided by Keods, strengthens Fives’ position and commitment to the global steel industry. These large-scale acquisitions were conducted with the full support of AXA Private Equity, the largest shareholder of Fives, which demonstrates its confidence in the overall strategy of Fives. For more information, visit www.fivesgroup.com.