Howden Acquires Thomassen Compression Systems BV.
Howden, one of the world's largest and longest established manufacturers of air and gas handling equipment, recently announced strong financial results for 2010 despite the global economic background. This acquisition represents a real boost for the Renfrew-headquartered multinational as it builds its compressor businesses worldwide and moves into new markets.
Howden and Thomassen have very similar core competencies in the application engineering of custom designed, high technology products for performance critical environments. Howden designs, engineers and supplies air and gas handling equipment including industrial fans, process gas compressors and rotary heat exchangers.
The compressor range, which includes screw, centrifugal turbo, diaphragm and horizontal piston compressors, is an increasingly important part of Howden's global portfolio. Accounting for over 17% of its [pounds sterling]562 million turnover in 2010, Howden's compressors are used for a variety of applications, especially in the oil & gas and petrochemical industries.
Thomassen, based in the Netherlands, focuses on the design, assembly, installation and servicing of custom-made horizontal piston compressors. Like the Howden range, these compressors are highly-engineered, large scale products, but with pressures up to 600 bar and power capability up to 25MW they are designed for high power applications, primarily in the oil refining and petrochemical industries. In recent years, Thomassen's main markets have been across Asia, Europe, South America and Africa. The company has approximately 280 employees mainly based in the Netherlands with the remainder located in service centres and sales offices around the world.
The primary application for high specification horizontal piston compressors is the compression of hydrogen. Both Howden and Thomassen are leaders in this market with Howden's range and experience being primarily for lower powers of up to 1MW (megawatt) and Thomassen's range and experience being for higher power ranges.
Thomassen will continue to operate from its premises at Rheden as a stand-alone business within Howden. The senior management team, led by Managing Director Frans Bisseling, have indicated that they intend to stay with the company following the acquisition and Thomassen's integration into the Howden group will be overseen by a team led by Bob Cleland (Howden Chief Executive) and Ian Brander (Howden Operations Director).
The combination of Howden and Thomassen creates a global company capable of supplying a comprehensive range of hydrogen compressors including a full suite of piston compressors with capability up to 25MW and 600 bar and diaphragm compressors with capability up to 3000 bar. This is expected to bring market opportunities not currently available to either company. Significant benefits will come from Howden's ability to extend Thomassen's presence in China and other markets where sales have been limited, and from Thomassen sharing access to Howden's global sourcing capabilities.
The acquisition will continue to diversify Howden's business and make it less reliant on the supply of new equipment to the coal-fired power industry, which provided 24 per cent of revenue in 2010 compared with 42 per cent in 2005. The compressor products are expected to account for over 25% of Howden's revenue after this acquisition.
Thomassen's aftermarket sales, arising primarily from its worldwide installed base of over 2,500 compressor cylinders - of which slightly over half are located in Europe, around a quarter in Asia and the remainder predominantly in South America and Africa - currently account for around one-third of revenues.
For the financial year ended 31 December 2010, Thomassen had revenues of E143.4 million (GBP [pounds sterling]125.6 million) and an order book worth E133.1 million.
Bob Cleland, Chief Executive of Howden said "I am absolutely delighted with this acquisition which adds a major range of complementary products to our compressor portfolio. It increases our activities in the refining and petrochemical sectors, which have been underweight compared to our core market of power generation. It is part of our strategy to widen our range of products used in performance critical applications in key global infrastructure industries. This acquisition reinforces Howden's position as a significant part of Scottish engineering, a sector which continues to play a leading role in the country's economy."
Commenting on the acquisition Michael Foster, Chief Executive of Charter International plc, said: "This is a transformational deal for Howden. We have very carefully considered the right acquisition for Howden and we are delighted to have secured Thomassen which will make Howden a leading presence in the supply of engineered compressors, in particular to the oil and gas and petrochemical industries. In addition, the acquisition will increase its revenues generated in emerging/growth economies and from the aftermarket.
"We believe that Howden and Thomassen together will be able to generate significant synergies, amounting to at least E5 million per annum by 2014, and continuing to increase thereafter. We expect the acquisition to enhance adjusted earnings per share in 2011, and to cover its cost of capital in 2012, the first full year of ownership."
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|Publication:||PR.com (Press Releases)|
|Date:||Apr 1, 2011|
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