Linamar says it is to purchase Carolina Forge Company's (CFC), business of high volume, hot forged product, in Wilson, North Carolina, as well as 66% of the shares of Seissenschmidt, also specialising in hot forgings.

Seissenschmidt has three main locations in Germany, Hungary and the US, while combined annual sales of the two entities are expected to be close to C$450m (US$403m), with a combined employee base of around 1,150 staff.

Linamar adds its move is due to the fit with its strategy of offering integrated metal forming/machined solutions in products such as gears, as well as supplementing its powertrain business and leveraging driveline, gear based products.

The company says the deal will also allow it to address market trends in light weighting and design for products such as gears, differentials, wheel bearings and hubs and sprockets with high speed forging processes.

"We are very pleased with these results of months of work in developing our global forging strategy," said Linamar CEO, Linda Hasenfratz.

"CFC is well known and positioned in the North American market, where we intend to invest further and grow significantly and Seissenschmidt is considered a global leader in terms of excellence in high volume forging technology, a reputation built over its 160 year history.

"The capabilities of these employees greatly enhance our component and system expertise in key markets such as gears which will be an important driver in increasing market share. Gear manufacturing is a key strategy for Linamar and an integrated forged and machined product a key element in solidifying our global dominance in this highly opportunistic market."

The CFC transaction is expected to close in the near future, while the acquisition of the 66% interest in Seissenschmidt is subject to, among other things, further due diligence and regulatory approval.

Show the press release

– Linamar Corporation (TSX:LNR), Carolina Forge Company, LLC (“CFC”) and 

majority shareholders of Seissenschmidt AG (“Seissenschmidt”) today signed separate definitive agreements for Linamar’s purchase of CFC’s 

business of high volume hot forged product, located in Wilson, North Carolina and 66% of the shares of Seissenschmidt, which also specializes 

in high volume hot forgings. Seissenschmidt has 3 primary locations in Germany, Hungary, and the United States. Combined annual sales of the 

two entities are expected to be close to $450 million CAD and the combined employee base is approximately 1,150 people.

Linamar has pursued these acquisitions because of the fit with its strategy of offering integrated metal forming/machined solutions to its 

customers in certain targeted products such as gears. The acquisitions will supplement Linamar’s core powertrain business, leverage its 

business in driveline, gear based products and enable Linamar to address the market trends in light weighting and NVH design for products like 

gears, differentials, wheel bearings, hubs and sprockets with high speed forging processes. 

“We are very pleased with these results of months of work in developing our global forging strategy,” said Linda Hasenfratz, Linamar’s CEO, 

“CFC is well known and positioned in the North American market, where we intend to invest further and grow significantly and Seissenschmidt is 

considered a global leader in terms of excellence in high volume forging technology, a reputation built over its 160 year history. The capabilities 

of these talented employees greatly enhance our component and system expertise in key markets such as gears which will be an important 

driver in increasing market share. Gear manufacturing is a key strategy for Linamar and an integrated forged and machined product a key 

element in solidifying our global dominance in this highly opportunistic market.” 

The acquisitions illustrate Linamar’s focus on innovation in manufacturing and advanced process capabilities and further its strategies of 

globalization and diversification. The CFC transaction is expected to close in the near future. The acquisition of the 66% interest in 

Seissenschmidt is subject to, among other things, further due diligence and regulatory approval. 

Original source: http://www.linamar.com/sites/default/files/cfc-seissenschmidt_release_-_26sep14.pdf

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