Would you like to explore our corporate site or visit your local website?
Stay on Corporate siteAfter the acquisition of Partek, KONE is the largest Nordic service and engineering company. The 2001 combined net sales of KONE and Partek totalled EUR 5 600 million and the number of employees exceeds 35 000.
KONE acquired a company with globally leading positions in all its core businesses. Partek's global brands are: Kalmar (container handling), Hiab (load handling), Valmet (forest machines) and Valtra (tractors).
The acquisition of Partek was successful. After the public tender offer, KONE owns more than 98 percent of the shares and votes in Partek. KONE has made a redemption offer for the remaining shares and securities entitling to shares in accordance with the Securities Market Act and the Finnish Companies Act. KONE is now the parent company of Partek. The aim is to de-list Partek from the HEX Exchanges by the end of 2002.
KONE's minimal debt and strong cash flow made the acquisition possible. The deal increased KONE's debt, but the sale of Partek's non-core operations and the strong cash flow of both companies are anticipated to decrease indebtedness.
KONE's Partek strategy
The key elements of KONE's Partek strategy are to substantially improve the profitability of the acquired businesses, and to develop and grow core businesses. Savings will be achieved through consolidation of the two companies. The divestment of non-core assets will create cash flow.
The elevator business and the entity formed by Partek's core businesses will be kept sufficiently separate. Container handling, load handling, forest machines and tractors form Partek's core.
KONE has in recent years improved its profit dramatically. This experience and expertise of improving profitability will be leveraged in Partek.
The profitability of Partek's business will be achieved by
- Focusing on core businesses and markets
- Streamlining processes and production, and increasing flexibility
- Applying the tight financial control of KONE
- Further standardisation of components and emphasis on R&D
Strengthening the after sales business and increasing its share of total sales is a key goal of the Partek strategy. After sales comprise around 15 percent of Partek's net sales, while the corresponding figure for KONE is approximately 60 percent. President Manfred Eiden and President Carl-Gustaf Bergström will lead a team that will chart how KONE's after sales expertise can best be leveraged throughout Partek.
KONE's both business groups will achieve an even more comprehensive global presence through the merger.
The focus of developing Partek's business is still on integrating its operations and utilising internal synergies. This process was started in Partek already in conjunction with the restructuring of the group.
Cost savings on the group level will quickly be achieved by consolidating financing, administration, tax planning and the IT infrastructure. The group functions finance and control, communications, legal affairs and IT infrastructure maintenance and development will be combined during autumn 2002.
Joint sourcing operations offer considerable savings potential. A combined KONE-Partek sourcing project has been initiated to harmonise joint sourcing.
Partek Board and Management
Partek's Extraordinary Shareholder's meeting will be held on 25 September 2002. Proposed for the new Partek board will be Antti Herlin, chairman, Carl-Gustaf Bergström, Klaus Cawén, Jean-Pierre Chauvarie, Manfred Eiden, Tapio Hakakari, and Aimo Rajahalme.
Carl-Gustaf Bergström is appointed President of Partek and Kari Heinistö is appointed Senior Executive Vice President. Carl-Gustaf Bergström will report CEO Antti Herlin. Partek's management will be reinforced with two key managers. M.Sc.(Eng.) Lauri Björklund is appointed director responsible for the development of Partek's production and M.Sc.(Econ.), LL.M. Pekka Sihvola is appointed CFO.
Partek board member, KONE's previous CEO Jean-Pierre Chauvarie will support the implementation of a profit improvement programme in Partek.
The consolidation of group administration in KONE and Partek, and personnel negotiations in regards to this will begin on September 9, 2002.
The consolidated result, detailed synergy estimates and group financial targets will be disclosed in the interim report due on October 22, 2002.
Sender:
KONE Corporation
Tapio Hakakari
Secretary to the Board of Directors
Annamari Lammassaari
Vice President, Corporate Communications
For additional information, Tapio Hakakari, tel. +358 20 475 4226, mobile +358 400 408 316.
www.kone.com
Attachments: