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Industri Kapital has agreed to buy Alfa Laval from Tetra Laval

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Industri Kapital and Tetra Laval have signed an agreement whereby the Industri Kapital 2000 Fund has agreed to buy Alfa Laval. Tetra Laval will retain a minority interest in the business. Industri Kapital’s intention is to further develop Alfa Laval as a global leader in equipment for Separation, Heat Transfer and Fluid Handling, with a view to listing the shares publicly within a five year period. The acquisition of Alfa Laval is the largest ever Scandinavian management buy-out transaction, and one of the largest in Europe.

“We view Alfa Laval as a very attractive investment” says Björn Savén, Chief Executive of Industri Kapital. “Alfa Laval has a strong position as the leader in its main markets. The group has a long history of technological innovations and a global market presence. We also look forward to working together with Tetra Laval in further developing Alfa Laval.”

“The development of Alfa Laval within the Tetra Laval Group has been remarkable. The activities of today’s Alfa Laval represent approximately 40% of its activities at the time of our acquisition in 1991, but the overall sales volume of the current activities now equals that of the total group when we acquired it. The bulk of the remaining businesses has either been integrated into Tetra Pak, been formed into independent units within Tetra Laval or has been divested. In Industri Kapital, Alfa Laval will have an owner that will focus on their core business. At the same time, Tetra Laval will be an active supporter of future growth plans as a significant financial investor”, says Göran Grosskopf, Chairman of the Tetra Laval Group Board.

“Our goal is to develop Alfa Laval into one of the leading global process technology companies, with a view to listing the company within a five year period. We support Alfa Laval’s strong emphasis on providing innovative solutions and superior after sales service”, says Harald Mix, Deputy Chief Executive of Industri Kapital.

“Alfa Laval will now enter a new era of development. With our new main owners, we will be able to increase our efforts to build and develop our business and to deliver superior products, systems and services to our customers. This is a very good solution for Alfa Laval”, says Sigge Haraldsson, Chief Executive of Alfa Laval.
The transaction is subject to regulatory approvals and other conditions in several jurisdictions including the European Union.

Debt financing for the transaction will be provided by a group of banks, consisting of BG-Bank, Den Danske Bank, DLJ, MeritaNordbanken/Unibank, Nykredit, SEB, Svenska Handelsbanken and UBS Warburg, lead by DLJ, SEB and UBS Warburg.

Subsequent to this divestment Tetra Laval will consist of three independent industrial groups – Tetra Pak, DeLaval and Tetra Pak Hoyer. The three companies are market leaders in their respective areas of operations. The companies’ activities are primarily focused on systems for production and distribution of food. Tetra Laval has close to 25 000 employees in more than 100 countries. 1999 sales were over 8 billion Euro.

The Buyer’s main advisors include PricewaterhouseCoopers, Allen & Overy, Freshfields and Vinge.

The Seller’s main advisors include Shearman & Sterling, Hammarskiöld & Co., Ernst & Young and Pembroke Advisors.

For further information please contact:

Björn Savén, Chief Executive, Industri Kapital, + 46 8 678 95 00

Harald Mix, Deputy Chief Executive, Industri Kapital, +46 8 678 95 00

Sigge Haraldsson, Chief Executive, Alfa Laval, +46 46 36 7000

Peter Torstensson, Vice President Communications, Alfa Laval, +46 46 36 7000

Jörgen Haglind, Vice President Communications, Tetra Laval, +46 46 36 46 10

About Industri Kapital

Industri Kapital is a leading European private equity firm with equity capital under management in excess of 2 billion Euro. Since 1989, 35 investments have been made in European companies in various industries. The fund investors are large Nordic, European and American institutional investors such as pension funds, investment and insurance companies.

About Alfa Laval

Alfa Laval employs approximately 11 100 people and has operations in 95 countries. In 1999 the company reported a turnover of 1,6 billion Euro. Tetra Pak acquired Alfa Laval in 1991, by a public bid on the Stockholm Stock Exchange.

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