Metso says it continuously strives to better serve the needs of Chinese customers and to support the sustainable development of China's industries and infrastructure.
Metso and LiuGong will form a 50%-50% joint venture to develop the track-mounted crushing and screening business in China.
The joint venture will combine Metso's know-how in track-mounted crushing and screening business and technology with LiuGong's extensive distribution resources (some 900 outlets) and manufacturing capabilities in China.
The initial scope of the joint venture will cover the design and manufacture of localised versions of Metso's Lokotrack 1000 series mobile crushers and screens, and the range may be further expanded in the future.
The products will be sold under dual branding: Metso LiuGong. The joint venture company will also promote Metso's global track-mounted crushing and screening equipment in China.
The joint venture enables the capture of a significant market share of the fast growing mobile crushing and screening market in China.
Metso says the deal will have no effect on Metso's existing distributor network in other parts of the world, and the transaction is subject to the relevant regulatory approvals, which are expected in the next six months.
The acquisition of 75% of Shaorui, which is one of the leading mid-market crushing and screening equipment producers in China, also gives Metso an option to purchase the remaining 25% of the company in the future.
The acquisition enables access to the Chinese mid-market and customers, and Metso says it forms a good platform for future growth in terms of the leading crushing and screening market position by combining Metso's current premium product offering with Shaorui's excellence in mid-market products.
“The technological know-how of both companies will be used to further enhance our product offering in China. In addition, after the acquisition, Metso will have a better product portfolio for penetrating new markets in Asia and Africa,” says Metso.
Shaorui's 18 sales and services centers and a strategically located manufacturing facility in southern China complement Metso's manufacturing unit in Tianjin. The transaction is subject to the relevant regulatory approvals, which are expected in the next few months.
"China is a very important market for us, and we want to be part of the future development of the fast growing construction market. The joint venture with LiuGong offers us an opportunity to enter the crushing and screening mobile equipment market in China together with a well-known partner.
“By acquiring 75% of Shaorui, we will gain deeper knowledge about the mid-market customers and products that will benefit us in many ways. In the longer term, both of these investments will naturally grow the installed base of Metso crushers in China providing future service potential," says Andrew Benko, president, Mining and Construction, Metso.
The Chinese construction equipment market is estimated to reach US$100 billion by 2016, driven by urbanisation and infrastructure development, and offers great growth opportunities for Metso.
Metso entered China 80 years ago: the first deliveries to China were made by Metso's predecessor in the 1930s. Currently, Metso Group has more than 3,200 employees in China and a local network of manufacturing and sales and service outlets. In 2011, China was one of Metso's biggest countries in terms of net sales, which total €777 million. Metso operates in seven fully owned factories and three service centres, and it has three joint ventures with local partners.
Shaorui Heavy Industries is said to be one of the leading mid-market crushing and screening equipment producers in China. It employs some 370 people, and is said to have a leading local market position and a well-known brand in South China. It is headquartered in Shaoguan of Guangdong Province.
Founded in 1958 in Liuzhou, China, LiuGong is the largest wheel loader manufacturer in the world, offering a full line of machines, including wheel loaders, bulldozers, backhoes, skid steers, forklifts, graders, excavators, rollers, truck-mounted cranes, pavers and cold planners.
The Company owns facilities in, among other locations, Liuzhou, Tianjin, Shanghai, Changzhou, Zhenjiang, Jiangyin and Bengbu.
