(Yicai Global) April 24 -- Xuzhou Handler Special Vehicle Co., a Chinese maker of aerial work platforms, plans to invest up to EUR6 million (USD7.3 million) in German fire truck manufacturer Hermann Schmitz GmbH to obtain a controlling stake in the firm before using it to take over another European firefighting equipment brand and expand worldwide.
Xuzhou Handler Chairman Ding Jianping penned a memorandum of understanding with Hermann Schmitz’s General Manager Dirk Schmitz in Xuzhou, Jiangsu province, on April 20, the Chinese firm said in a statement yesterday. The agreement will give the company a roughly 60-percent stake in the target, with the exact figure depending on the final investment amount.
After the deal, Xuzhou Handler plans to take control of Germany’s Gimaex SAS and merge the two European units, the statement said. Schmitz will oversee both transactions and nominate executives for the new company.
Hermann Schmitz has solidified its brand in China over the past decade or so by selling nearly 700 high-end fire trucks there. Xuzhou Handler hopes it can capitalize on this image to increase its share of the mid- to high-end fire engine market and establish a global presence, it added.
The worldwide fire engine market is on track to be worth USD7.4 billion by 2024, according to late 2016 research by Grand View Research. It believes growing infrastructure in China, India, South Korea and other developing nations will drive global demand, with Europe, the Middle East and Africa hitting a compound annual growth rate of around 5 percent.
It expects a 5-percent compound annual growth rate over the eight-year period in Europe, the Middle East and Africa, and believes growing infrastructure in China, India, South Korea and other developing nations will drive global demand.
Editor: James Boynton