Trelleborg acquires ČGS Holding

Reinforcing Trelleborg as a world leader in engineered polymer solutions
Trelleborg has signed an agreement to acquire ČGS Holding a.s. – a privately
-owned company with leading positions in agricultural, industrial and specialty
tires as well as engineered polymer solutions. The total cash consideration
amounts to approximately SEK 10.9 billion on a cash and debt-free basis. ČGS is
headquartered in the Czech Republic and generated sales of approximately SEK 5.6
billion with an EBIT-margin of 16 percent in the rolling 12-months period ended
June 30, 2015.

Closing of the transaction is subject to approvals from relevant authorities and
is expected to be completed in the first half of 2016.

“I am very proud to announce this highly complementary acquisition, which is a
significant and attractive add-on to our existing businesses. ČGS, with its
strong and favorably performing operations in agricultural and industrial tires
as well as engineered polymer solutions, will strengthen and complement
Trelleborg’s already leading positions in a number of existing areas,” says
Peter Nilsson, President and CEO of Trelleborg.

With the acquisition of ČGS and its subsidiary Mitas, Trelleborg is establishing
itself as a global leader in agricultural tires and reinforces its leading
position in industrial tires. As a result of the acquisition, Trelleborg Wheel
Systems will almost double its revenues, broaden its geographical reach and add
new positions in complementary tire niches. Mitas is performing strongly despite
the current downturn in the agricultural market. Moreover, the acquisition of
ČGS’s other industrial polymer businesses will enhance Trelleborg’s leading
positions in several of the Group’s existing business areas.

“ČGS highly complements our manufacturing footprint with well-invested and
competitive production facilities in Central and Eastern Europe, the U.S. and
Mexico. The transaction adds to our capabilities, represents a strong strategic
fit and is expected to generate significant synergies and cross-selling
opportunities. The plan is to gradually integrate the acquired entities into
Trelleborg’s existing business areas. We regard the purchase price as attractive
given the synergy potential and expected recovery for the agricultural market,”
concludes Peter Nilsson.

According to Trelleborg’s preliminary assessment, the cost synergies are
expected to be in excess of SEK 300 million annually compared with 2015,
gradually realized over three years.

The acquisition will be financed through committed bank facilities. Trelleborg’s
leverage will initially be slightly above 3x Net Debt/EBITDA on a pro-forma
basis. This is higher than Trelleborg’s long-term ambition and the intention is
to return to a leverage ratio similar to the levels prior to the acquisition
over the next 12-18 months.

Key facts regarding ČGS Holding
ČGS is a leading supplier of specialty tires and engineered polymer solutions.
The company employs approximately 6,300 people, is headquartered in the Czech
Republic and has 13 production sites of which 11 are located in Central and
Eastern Europe, one in the U.S. and one in Mexico.

The group includes the main subsidiaries Mitas, Rubena and Savatech. Mitas
accounts for approximately two-thirds of group sales and has strong mid-market
specialty tires brands with a particularly strong position in agricultural
tires. Mitas offering is complemented by Rubena’s and Savatech’s niche
engineered polymer solutions businesses. Rubena and Savatech develop and
manufacture a broad range of engineered polymer products, including seals,
sealing profiles, specialty conveyor belts, printing blankets and other
engineered fabrics.

For more information about ČGS Holding, refer to ČGS Holding’s annual report at
the following
link (http://www.cgs.eu/index.php?stranka=2&rid=41&cid=270&article=cgs-holding-a
-s-annual-report).

Summary of additional financial information
The pro-forma combined sales for Trelleborg and ČGS Holding in the rolling 12
-months period ended June 30, 2015, amounted to approximately SEK 30 billion.
The combined companies will have approximately 23,000 employees.

On a pro-forma rolling 12-months period ended June 30, 2015, basis, ČGS Holding
adds approximately SEK 1.1 bn to EBITDA and SEK 0.9 bn to EBIT before
amortization of surplus values from the purchase price allocation.

Telephone conference
Analysts, investors and media are invited to attend a telephone conference at
09:30 a.m. CET on November 9, 2015. Please see separate invitation for details.
For further information, please contact:
Media: Vice President Media Relations Karin Larsson, 46 (0)410 67015, 46 (0)733
747015, karin.larsson@trelleborg.com
Investors/analysts: Vice President IR Christofer Sjögren, 46 (0)410 67068, 46
(0)708 665140, christofer.sjogren@trelleborg.com
This is information of the type that Trelleborg AB (publ) is obligated to
disclose in accordance with the Swedish Securities Exchange and Clearing
Operations Act and/or the Financial Instruments Trading Act. The information was
issued for publication on November 9, 2015, at 7:30 a.m. CET.
Trelleborg is a world leader in engineered polymer solutions that seal, damp and
protect critical applications in demanding environments. Its innovative
engineered solutions accelerate performance for customers in a sustainable way.
The Trelleborg Group has annual sales of about SEK 22 billion in over 40
countries. The Group comprises five business areas: Trelleborg Coated Systems,
Trelleborg Industrial Solutions, Trelleborg Offshore & Construction, Trelleborg
Sealing Solutions and Trelleborg Wheel Systems. In addition, Trelleborg owns 50
percent of TrelleborgVibracoustic, a global leader within antivibration
solutions for light and heavy vehicles, with annual sales of approximately SEK
16 billion in about 20 countries. The Trelleborg share has been listed on the
Stock Exchange since 1964 and is listed on Nasdaq Stockholm, Large Cap.
www.trelleborg.com