Bosch Rexroth plans to acquire a 50% stake in its sales partner Hytec Holdings (Pty) Limited, a wholly owned subsidiary of the Tesuco Group for an undisclosed sum. Hytec Holdings generated sales of almost R1bn (about EUR63m) in the 2013/2014 fiscal year and employs 675 employees across its operations.
The transaction, which is subject to regulatory approval, will cement Hytec’s position as the supplier and manufacturer of hydraulic and automation components and fluid power solutions in Africa. Bosch Rexroth will have the option to increase its shareholding over the next few years to 100% of the Hytec Group. Power Team, a subsidiary company of the Hytec Group which specialises in hydraulic maintenance tools and torque tightening equipment, is excluded from the deal and will remain a wholly owned subsidiary of the Tesuco Group.
“Strategically the deal allows Hytec to gain closer synergies with a business partner with whom we already have strong ties, combining our complementary activities to achieve greater performance and increase our market share in sub-Saharan Africa,” says John Wingrove, Group Managing Director of Hytec Holdings. “The best practice and technical knowledge that exists between the two businesses underpins what is a natural progression of our business growth,” he adds.
Dr Karl Tragl, President of Bosch Rexroth AG, said, “This acquisition is an important step for Bosch Rexroth to increase our presence in Africa which, in turn, will allow us to better fulfill the needs of our customers. As technical experts who know the local market well, the Hytec Group has been an important partner of ours for many years, so it is a natural progression for us to expand our presence in the region together with them. This acquisition brings together two premier organisations and reinforces our strong joint commitment to the African continent. Combining the best talent between our two organisations enhances our ability to deliver world-class solutions to our clients.”
Michael Burgess, CEO of Tesuco Holdings added, “From a Tesuco perspective, the deal affords Tesuco the opportunity to further advance its existing and greenfield business interests by optimising existing assets.” Hytec’s existing 31 branches and operations across South Africa, Ghana, Mozambique, Namibia and Zambia will provide a strong basis for Bosch Rexroth to further expand its network into Africa which is seen as a key growth area. Bosch Rexroth employs over 36,700 people across all operations and sales volumes in 2013 topped EUR5.7bn.