Duerr Buys Majority in Homag to Expand Into Wood-Processing GearElisabeth Behrmann
Duerr AG bought a majority stake in Homag Group AG, a manufacturer of wood-processing equipment, for 219 million euros ($297 million) to diversify its business.
Duerr, a maker of painting plants for the automobile industry, has 53.7 percent in Homag after offering key shareholders 26.35 euros a share in cash, the Bietigheim-Bissingen, Germany-based company said today in a statement. That’s a premium of 4.1 percent to Homag’s July 14 closing price. Duerr also gained voting rights over 75.8 percent of its target and is seeking to buy the rest of the company, it said.
“We see growth for Homag’s products in North America, where it’s gaining market share, and in emerging markets, particularly China,” Chairman Ralf Dieter said during a call with reporters. Demand in China “for automatic wood-processing machines is growing as wages rise, driving demand for furniture.”
Homag is a leader in wood processing machines, with 28 percent market share globally. Homag had sales of 789 million euros last year, and earnings before interest and taxes and after employee participation of 34.6 million euros. Only 21 percent of that revenue came from Germany.
Duerr shares fell 3.2 percent to 61.50 euros in Frankfurt today, while Homag rose 7.5 percent to 27.21 euros.
Homag’s wood-processing business will become Duerr’s second-biggest unit after its painting machines, Dieter said. The deal is subject to regulatory approval.
“We have very high market share already in our core business and wouldn’t be able to buy further auto businesses,” said Dieter. “We’re staying in our core business and are adding more businesses, like we did in the last few years.”