DaimlerChrysler sells jet-engine maker

21st November 2003, Comments 0 comments

21 November 2003 , STUTTGART - Transatlantic automotive concern DaimlerChrysler announced Friday that it has reached terms with the US investment company Kohlberg Kravis Roberts & Co (KKR) to sell the jet engine maker MTU Aero Engines. The announcment, following several weeks of reports in the media that DaimlerChrysler was close to reaching a deal with KKR, made no mention of a sales price. Industry sources told Deutsche Presse-Agentur, dpa that they believed that the transaction was in the vicinity o

21 November 2003

STUTTGART - Transatlantic automotive concern DaimlerChrysler announced Friday that it has reached terms with the US investment company Kohlberg Kravis Roberts & Co (KKR) to sell the jet engine maker MTU Aero Engines.

The announcment, following several weeks of reports in the media that DaimlerChrysler was close to reaching a deal with KKR, made no mention of a sales price.

Industry sources told Deutsche Presse-Agentur, dpa that they believed that the transaction was in the vicinity of EUR1.5 billion.

DaimlerChrysler only said that the sale is subject to the approval of regulatory authorities.

MTU Aero Engines is 100 percent-owned by DaimlerChrysler, falling under the automotive company's "Other Activities" division.

In 2002, MTU, with nearly 8,400 employees posted revenues of nearly EUR2.2 billion, down from EUR2.49 billion the year before.

The company is involved in jet engine manufacturing and cooperation with other major jet engine makers around the world for both civilian and military aircraft, including the new Eurofighter and the Airbus A400M military transport plane.

DaimlerChrysler management said that the sale of Munich-based MTU opened "new opportunities" for the company's further development.

In the speculative media reports about the MTU sale, KKR was singled out as the likely buyer, with the business daily Handelsblatt having cited industry sources as saying that DaimlerChrysler had decided to negotiate exclusively with KKR.

In late October, DaimlerChrysler chief financial officer Manfred Gentz said that a deal on the sale of MTU was possible before the end of the year. He said DaimlerChrysler wanted to sell the company because it does not belong to the concern's core business activities.

Besides KKR, a further possible buyer for MTU mentioned was British financial investor Doughty Hanson.

DPA
Subject: German news




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