FLSmidth’s decision to exclude thyssenkrupp’s mining business in India from its acquisition of the German company has cut €45 million off the purchase price and about €100m off the circa-€780m annual revenue expected to be delivered by the deal.
Copenhagen-based FLSmidth said it had a “strong presence in India” and the “TK Mining activities in India are not strategically important for the transaction”.
“The exclusion of the TK Mining activities in India will not affect the transfer of TK Mining’s key IP and technologies to FLSmidth as part of the overall transaction,” FLSmidth said.
It said the now-€280m (US$325m) deal, announced at the end of July this year, was still expected to deliver circa-€50m run-rate synergies while integration costs of about €75m wouldn’t be impacted.
The combined FLSmidth-thyssenkrupp Mining is forecast to generate €2250m of annual mining-related revenues, plus about €750m of cement-market revenue.
The deal is not expected to close until the second half of next year.