Weichai Subsidiary Germany Keiou Formally Acquires Dematic

On June 22, 2016, Weichai Power Co., Ltd. announced in Hong Kong that KION GROUP AG, an overseas subsidiary of Weichai Power, signed an agreement with the shareholders of Dematic Group S.àr.l to acquire all the shares of Dematic Group S.àr.l. . The consideration for the purchase transaction will be paid in cash, with a total transaction value of approximately US$2.1 billion, and KION will acquire all the shares of Dematic after the transaction is completed.
Weichai Power Co., Ltd. Weichai Power Co., Ltd.

Dematic is a leading global supplier of highly integrated automation technology, software, and services to optimize the supply chain and meet customer material handling needs. Its product and system portfolio covers a wide range of applications, from automatic guided vehicles to pallet stackers and including Automatically store storage sorting equipment such as retrieval systems, sorters and conveyors, leading integrated software platforms and automation technologies. Since 2013, Dematic has grown at an average annual rate of more than 12%. In 2015, it achieved operating income of 1.8 billion U.S. dollars, and the adjusted EBIT was US$ 166 million. Dematic employs nearly 6,000 skilled logistics professionals - including more than 3,000 engineers in engineering, software development, technology R&D, project management and customer service to serve customers worldwide. Dematic has a global engineering center and manufacturing base and has more than 100 locations in 22 countries around the world. With leading position in the United States, Europe and other parts of the world, it has provided more than 4,500 integrated systems for multi-industry SMEs, including the fastest-growing e-commerce industry.

This acquisition has enabled KION and Dematic to form effective complementarities and synergies. KION, the world's second-largest manufacturer of forklift truck production and warehousing technology services, acquires Dematic, a leading provider of automation and supply chain optimization experts, and will become a leading global provider of intelligent internal logistics solutions. KION's largest shareholder, Weichai Power fully supports this acquisition and will make full use of business opportunities in industrial automation and digitalization. KION's acquisition is in full compliance with Weichai Power's overall strategic goals and global strategic layout. It expands Weichai Power's business distribution in the global, especially North America, markets, diversifies its regional and business operations, and further enhances its anti-risk capabilities.

In December 2012, Weichai Power invested in the world's leading industrial forklift manufacturer, the KION Group, to obtain a 25% stake. On June 28, 2013, KION successfully listed on the Frankfurt Stock Exchange in Germany. Currently, it is a German MDAX constituent stock and the European STOXX 600 index (this index includes the top 600 companies in Europe). Weichai Power further increased its shareholding in KION to 38.25%, becoming a single major shareholder of KION, and started to fully report on KION in mid-2014. In 2015, KION achieved operating revenue of 5.09 billion euros, accounting for nearly 50% of Weichai Power's consolidated operating revenue, and realized a net profit of 221 million euros, which greatly enhanced Weichai's power performance and overall strength. Weichai's power business structure was more reasonable.

Weichai Power always adheres to the global operation strategy of “product management + capital operation” with two-wheel drive, successfully building a powertrain (engine, transmission, axle), complete vehicle, hydraulic control and auto parts. A new pattern of coordinated development of the four major industry sectors. In recent years, Weichai Power actively seeks for strategic transformation and structural adjustment, builds a diversified business structure driven by the entire vehicle, accelerates global business distribution and international cooperation, and gradually frees itself from excessive dependence on investment. In the future, Weichai Power will seize opportunities such as China's manufacturing of 2025, Internet+, and smart manufacturing to promote the company’s transformation from land-based power to full-field power transformation, from general technology to core technology, and from investment to investment and dual-driven transformation. The transition from domestic development to global development and transformation from manufacturing to service manufacturing enterprises has led China's equipment manufacturing industry to make a breakthrough and move toward the world.

The Chinese dream is the dream of every Chinese company, and it is also the dream of every whisperer. Weichai Power's “13th Five-Year Plan” has established “Weichai Dream” that will create a century-long enterprise and keep the foundation of the industry forever. KION's acquisition of Dematic will help realize the “Weichai Dream” that will build a century-long enterprise and keep the foundation evergreen. It will help promote the transformation and upgrading of China's equipment manufacturing industry and structural adjustment.

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