SKF makes strategic acquisition to strengthen its lubrication management capabilities

Rhea-AI Summary

SKF (SKFRY) has announced a strategic acquisition of John Sample Group's (JSG) Lubrication and Flow Management businesses, strengthening its position in the lubrication management sector. This move expands SKF's presence in the India and South-East Asia (ISEA) region, targeting a critical aspect of machine reliability. JSG, with annual sales of approximately SEK 550 million, will boost SKF's Lubrication Management business to around SEK 7 billion in net sales.

The acquisition provides SKF access to JSG's wide customer base, sales and distribution network, and engineering capabilities. It aligns with SKF's strategy to offer tailored lubrication solutions and improve bearing performance. The deal is expected to be completed in Q4 2024, enhancing SKF's ability to address premature bearing failures caused by poor lubrication and contamination.

Positive

• Acquisition strengthens SKF's lubrication management capabilities
• Expands presence in the growing India and South-East Asia (ISEA) region
• Adds approximately SEK 550 million in annual sales to SKF's portfolio
• Provides access to JSG's wide customer base and distribution network
• Margin accretive acquisition
• Boosts SKF's Lubrication Management business to around SEK 7 billion in net sales

Negative

• None.

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GOTHENBURG, Sweden, Aug. 14, 2024 /PRNewswire/ -- SKF has signed an agreement to acquire John Sample Group's (JSG) Lubrication and Flow Management businesses. JSG is a well established provider of lubrication management systems and services. The acquisition further strengthens SKF's offering in an identified growth segment, as well as its business operations in the expansive India and South-East Asia (ISEA) region.

More than half of all premature bearing failures are caused by poor lubrication and contamination. This means that lubrication is a critical aspect in machine reliability with a direct and profound impact on production output and quality, costs, and the environment. SKF, through the Lincoln and SKF brand, has already today a strong position in automatic lubrication systems, and the acquisition provides access to JSG's wide customer base, sales and distribution network, as well as engineering and services capabilities.

JSG had sales of approximately SEK 550 million in their latest fiscal year, is margin accretive and has 86 employees. Following the acquisition, net sales for SKF's Lubrication Management business will be around SEK 7 billion.

"This acquisition is a good strategic fit as it enables us to become a significant lubrication systems player in the important ISEA region. Lubrication is an important part of SKF's portfolio of offering, enabling us to offer our customers tailored stand-alone lubrication solutions as well as improved bearing performance. As an essential part of industrial maintenance, effective lubrication management also contributes to a sustainable business and society," says Thomas Fröst, President, Independent and Emerging Business, at SKF.

"At this stage in my career, transition of the John Sample Group is a natural and positive evolution. It is important for me and my family when making any decision of this kind, to engage with a party whose future vision for JSG is as closely aligned with our purpose, values, and strategies," says John Sample, Executive Chairman, John Sample Group Pty Ltd.

Founded in 1921, JSG is headquartered in Sydney, Australia, and serves a wide range of industries, including mining, construction and off-highway, pulp and paper, food and beverages, and transportation, across the product verticals Lubrication Systems and Instrumentation & Flow. The acquisition is expected to be completed during Q4 2024.

Aktiebolaget SKF 

For further information, please contact:

PRESS: Carl Bjernstam, Head of Media Relations
tel: 46 31-337 2517; mobile: 46 722-201 893; e-mail: carl.bjernstam@skf.com 

INVESTOR RELATIONS: Sophie Arnius, Head of Investor Relations
tel: 46 31-337 8072; mobile: 46 705-908 072; sophie.arnius@skf.com 

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SOURCE SKF

FAQ

What company is SKF (SKFRY) acquiring?

SKF is acquiring John Sample Group's (JSG) Lubrication and Flow Management businesses.

How much annual revenue does JSG's acquired business generate?

JSG's acquired business generates approximately SEK 550 million in annual sales.

When is the acquisition of JSG by SKF (SKFRY) expected to be completed?

The acquisition is expected to be completed during Q4 2024.

What will be the total net sales for SKF's Lubrication Management business after the acquisition?

Following the acquisition, net sales for SKF's Lubrication Management business will be around SEK 7 billion.

How does this acquisition align with SKF's (SKFRY) strategic goals?

The acquisition aligns with SKF's strategy to strengthen its lubrication management capabilities, expand in the ISEA region, and offer tailored lubrication solutions to improve bearing performance.