Sandvik has signed an agreement to divest its Mining Systems operations to the private equity company CoBe Capital. Sandvik will maintain ownership of ongoing projects, which are close to finalization. The closing of the transaction is expected during the fourth quarter of 2016.
“Divesting the Mining Systems is an important step in consolidating Sandvik to its core operations, which for Sandvik Mining and Rock Technology is high technology mining equipment and aftermarket offerings”, said Björn Rosengren, president and CEO of Sandvik.
The deal represents a capital loss of 800 million SEK ($92 million) for Sandvik. Mining Systems designed, engineered and supplied material handling systems for the mining industry. In 2015, the Mining Systems operations, with 1,100 employees, had annual sales of 5 billion SEK ($580 million) representing 6% of Sandvik Group revenues, and an operating loss was reported at a low single digit margin level.