Sandvik exits non-strategic businesses

Rhea-AI Summary

Sandvik has announced strategic changes in its business focus, resulting in the divestment of non-core assets. The company has sold the engineer-to-order business of DWFritz Automation to Balmoral Funds and decided to exit its minority stake in BEAMIT, an Italian additive manufacturing service provider. These moves align with Sandvik's renewed focus on software solutions, enabling hardware, and metal powders in additive manufacturing.

The company will incur charges of approximately SEK 390 million in the third quarter, reported as items affecting comparability. This includes a capital loss of about SEK 250 million from the DWFritz divestment and a write-down of SEK 140 million related to the BEAMIT stake. Sandvik will retain the ZeroTouch® platform, which is important to its closed loop strategy. Both DWFritz and BEAMIT were previously reported under the Sandvik Manufacturing and Machining Solutions business area.

Positive

• Strategic realignment to focus on core businesses in software solutions and enabling hardware
• Retention of the valuable ZeroTouch® platform for near-line and in-line metrology
• Streamlining operations by divesting non-strategic assets

Negative

• Incurring charges of approximately SEK 390 million in Q3
• Capital loss of about SEK 250 million from DWFritz divestment
• Write-down of SEK 140 million related to BEAMIT stake

STOCKHOLM, Sept. 27, 2024 /PRNewswire/ -- At the Capital Markets Day 2023, Sandvik communicated the intention to increase the focus on software solutions and enabling hardware in the Sandvik Manufacturing Solutions offering. Furthermore, Sandvik communicated a revised additive manufacturing strategy to focus mainly on metal powders. As a consequence of these changes in strategic direction, the engineer-to-order business of DWFritz Automation (DWFritz) has been divested and the decision to seek an exit of the minority stake in BEAMIT has been made during the quarter. Charges totaling approximately SEK 390 million will be accounted for in the third quarter and reported as items affecting comparability. Out of the total charges, approximately SEK 250 million relates to a capital loss, including transactional costs, from the divestment of DWFritz, and about SEK 140 million relates to a write-down of the stake in BEAMIT.

Sandvik has divested the engineer-to-order business of DWFritz to the U.S.-based private equity firm Balmoral Funds. Sandvik acquired DWFritz in 2021, with the intention to grow the ZeroTouch® business of DWFritz. The ZeroTouch® platform is a unique inspection gauging equipment enabling near-line and in-line metrology and is an important part of the closed loop strategy. Since the acquisition, Sandvik has developed and started to commercialize ZeroTouch®, which will not be part of the divestment but remain a part of Sandvik.

Additionally, Sandvik has decided to seek an exit of its minority stake (approx. 30%) in the Italian additive manufacturing service provider BEAMIT. The decision to seek an exit is in line with Sandvik's revised additive manufacturing strategy to focus mainly on metal powders.

DWFritz and the BEAMIT holding have both been reported within business area Sandvik Manufacturing and Machining Solutions.

For further information, contact Louise Tjeder, VP Investor relations, phone: +46 (0) 70782 6374 or Johannes Hellström, Press and Media Relations Manager, phone: +46 (0) 70721 1008

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https://news.cision.com/sandvik/r/sandvik-exits-non-strategic-businesses,c4044116

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Sandvik exits non-strategic businesses

 

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SOURCE Sandvik

FAQ

What businesses is Sandvik (SDVKY) exiting?

Sandvik is exiting the engineer-to-order business of DWFritz Automation and seeking to exit its minority stake (approximately 30%) in BEAMIT, an Italian additive manufacturing service provider.

How much will Sandvik (SDVKY) charge in Q3 2024 for these exits?

Sandvik will charge approximately SEK 390 million in the third quarter of 2024, reported as items affecting comparability.

Who purchased the engineer-to-order business of DWFritz from Sandvik (SDVKY)?

The U.S.-based private equity firm Balmoral Funds purchased the engineer-to-order business of DWFritz from Sandvik.

What is Sandvik (SDVKY) retaining from the DWFritz acquisition?

Sandvik is retaining the ZeroTouch® platform, which is a unique inspection gauging equipment enabling near-line and in-line metrology and is important to their closed loop strategy.