Michelin announces acquisition of Flex Composite Group
Date: 19 Jun 2023
and IDI have announced they have reached an agreement on the terms by which
Michelin would acquire 100% of Flex Composite Group (FCG) for an enterprise
value of Euros 700 million.
is a European leader in engineered fabrics and films with applications in
highly technical markets such as marine, supercars & electric vehicles,
sports, or construction. FCG masters a wide range of polymer composite
solutions, adjacent to those already developed by Michelin. The company has 400
employees. It primarily operates in Europe, in fast-growing markets with strong
demand dynamics catering to high-end customers. In 2022 FCG reported €202
million revenue. Over the 2015-2022 period, it delivered an average organic
growth of 11%, with 25 - 30% EBITDA margin.
agreement would enable Michelin and FCG to create a leader in high-tech
engineered fabrics and films. This acquisition is in perfect alignment with
Michelin in Motion 2030 strategy. This will mark a significant step forward in
Michelin’s strategy of growing its polymer composite activities in adjacent
areas, leveraging unrivalled innovation and R&D capabilities, and
benefiting from FCG’s advanced customers intimacy and industrial process expertise.
transaction would unlock deep innovation synergies in a broad range of products
and applications, while further improving the environmental footprint of FCG.
acquisition would grow Michelin’s High-Tech Materials revenue by 20% and
accelerate the growth profile of this business. The transaction would be EBIT
margin-accretive for Michelin at Group level and for the Specialty segment it
will belong to, with positive cash generation and EPS impact.
Menegaux, CEO of Michelin, declared: “We are very pleased to extend a warm
welcome to the FCG teams into our Group, to create a recognized leader in
high-tech technical fabrics and films. This operation draws on the best of both
companies, in particular on our shared expertise in polymer composite
solutions. We are aiming to generate synergies and to push back the frontiers
of deep-tech innovation in a wide range of new products and applications. This
acquisition is a milestone in our strategy to position the Group as a key
player in polymer composite solutions beyond mobility.”
Capriglione, General Manager of FCG, declared: “FCG has enjoyed very
substantial growth in its business in the last years. This success is due to a
number of key factors: recognized expertise in composite materials and films, a
capacity for innovation and a strong desire to constantly improve the service
provided to its customers. With Michelin, FCG will be able to increase its
capacity for innovation, its actions to reduce its environmental footprint and
to provide its customers with more sustainable materials.”
transaction would be paid in cash and is fully financed through cash at hand,
with Michelin’s financial position remaining strong post transaction.
transaction is expected to close by the end of Q3 2023, subject to customary
closing adjustments and merger control clearances in relevant jurisdictions.