FLSmidth has agreed to purchase thyssenkrupp’s Mining Technologies business (TK Mining) for €325 million ($522.28 million) to create a pit-to-plant technology solution with a sustainable focus.
The deal was highly amenable as both companies had complementary interests in transforming their businesses.
FLSmidth is a Danish company which serves over 60 countries with engineering, equipment and service solutions for minerals, metals, concrete, electronics and more.
FLSmidth chief executive officer Thomas Schulz said the addition of TK Mining’s prowess in mining systems, materials handling and processing would complement his business.
“TK Mining and FLSmidth are a perfect match and I am proud to announce this agreement to join forces,” Schulz said.
“This is a truly transformational deal allowing us to accelerate our growth ambitions in mining by creating a stronger talent pool, and one of the world’s largest and strongest suppliers to the mining industry.”
The deal will welcome 3400 TK Mining employees to FLSmidth, once regulatory requirements are completed within the next 12 months.
As a multinational group of industrial and technology businesses, thyssenkrupp saw the deal not as a loss, but a shedding, to allow it to strengthen other business areas, according to the company’s chief executive officer Martina Merz.
“The successful sale of the mining business shows that we are pressing ahead at full speed with the transformation of thyssenkrupp and achieving important results step by step,” Merz said.
“But we have not yet reached our goal. The principle ‘performance first’ continues to apply. We need to return to positive cash flow as quickly as possible. The sale of Mining Technologies makes an important contribution to this,”
Merz added how FLSmidth was the perfect partner, with similar ideals and goals for TK Mining.
“At the same time, I am pleased that we have found a very good new owner in FLSmidth. FLSmidth presented a convincing business strategy and a clear vision for the mining business,” she said.
“It will give our employees attractive prospects. That was extremely important to us when negotiating the sale.
“The merged new company will be able to drive innovation and digitalisation even faster and will increasingly focus on sustainability and ways to reduce environmental footprint.”
FLSmidth saw the deal as an opportunity to advance its MissionZero targets, which look to eliminate company carbon emissions by 2030.
“TK Mining’s extensive active installed base, together with FLSmidth’s strong existing service setup, will provide additional aftermarket opportunities, while the joint R&D (research and development) capabilities and combined portfolio will enable accelerated innovation in digitalisation and MissionZero solutions,” FLSmidth stated.