Rieter, a supplier of systems for manufacturing yarn from staple fibers in spinning mills, has signed a definitive agreement to acquire Barmag from OC Oerlikon for an upfront equity purchase price of CHF 713 million ($868 million).
Barmag is a provider of filament spinning systems used for manufacturing manmade fibers, texturing machines, BCF systems, staple fiber spinning and nonwovens solutions. The company also provides engineering services for solutions along the textile value chain. In the financial year 2024, the company generated sales of CHF 734 million ($894 million) with around 2,600 employees.
Barmag comprises the established product brands Oerlikon Barmag, Oerlikon Neumag and Oerlikon Nonwoven. The main markets for the Barmag product portfolio are China, India, Türkiye and the United States of America. The innovative and technologically advanced products are developed in Remscheid and Neumünster (Germany) as well as Suzhou and Wuxi (China).
“We are very proud to welcome Oerlikon Barmag, Oerlikon Neumag and Oerlikon Nonwoven to Rieter. We are convinced that this combination will form a market leader in the textile industry which will create value for our shareholders, customers and employees,” says Thomas Oetterli, CEO of Rieter.
“With this solution, we will have the best new ownership possible, as we will benefit from each other as textile companies from market understanding, technology expertise and complementary offering for our global customer base,” says Georg Stausberg, CEO of Barmag.
The enterprise value of CHF 850 million (about $1 billion) represents a through-the-cycle EV/EBITDA of 6.3x (excluding synergies). If certain financial criteria are achieved by 2028, an earn-out component will be paid to the seller. The acquisition is expected to enhance Rieter’s financial performance, given Barmag’s structurally higher through-the-cycle profitability and margin resilience in market downturn.
The acquisition financing is secured by a bridge loan facility. Refinancing of the bridge facility will happen through a fully underwritten CHF 400 million ($487 million) rights issue with tradable subscription rights, a CHF 77 million ($93 million) non-pre-emptive private placement, which is fully committed and subscribed by Rieter’s two largest shareholders and a bank financing.
Rieter’s largest shareholder, Peter Spuhler (c. 33% shareholding) is supportive of the transaction and committed to participating in the rights-issue pro-rata by exercising its subscription rights as well as investing additional capital through the non-pre-emptive capital raise. After the capital increase, PCS Holding AG is expected to retain a shareholding of c. 33%.
Additionally, Rieter’s second-largest shareholder, Martin Haefner (c. 10%), also supports the transaction and has committed to participating pro rata in the rights issue by exercising its subscription rights and investing additional capital through the non-preemptive capital raise.
Alantra is acting as exclusive financial advisor and Lenz & Staehelin as legal advisor to Rieter. UBS underwrites the bridge loan facility and acts as Sole Global Coordinator, Sole Bookrunner and Sole Manager of the capital increase.
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