I Mining Business Review I

“This acquisition is an important step in our growth ambition. DSI Underground’s track record of driving progress and safety in underground operations and its global reach will further strengthen our world-leading market position within mining and rock solutions.”

Stefan Widing,
President and CEO,
Sandvik.

| Photo Credit: Sandvik

  • Since Triton’s acquisition, DSI Underground has become a globally leading system supplier of innovative technologies for Underground Mining and Tunnelling
  • Sandvik Group’s and DSI Underground operations are complementary and the combined business is expected to further enhance customer offerings
  • The parties have agreed not to disclose the terms of the transaction. The sale is subject to regulatory approval.

Sandvik has signed an agreement to acquire DSI Underground, the global leader in ground support and reinforcement products, systems, and solutions for the underground mining and tunneling industries. The company will be reported in Sandvik Mining and Rock Solutions business area which supplies equipment, tools, service, and support for the mining and construction industries. 

This includes rock drilling and cutting, loading and hauling, tunneling and quarrying. With the addition of DSI Underground, Sandvik will gain a valuable sales footprint around the globe by adding more than 20+ local production facilities on all continents. With this acquisition, Sandvik will be able to offer the industry’s widest range of mining products and solutions with increased resources, expertise, and market reach. DSI Underground builds upon and strengthens Sandvik’s capabilities and solutions in selected key markets.

“This acquisition is an important step in our growth ambition. DSI Underground’s track record of driving progress and safety in underground operations and its global reach will further strengthen our world-leading market position within mining and rock solutions”, says Stefan Widing, President and CEO of Sandvik.

Since Triton’s acquisition in 2011, the management and board of DSI Underground have improved the company by several initiatives. Today DSI Underground is the globally leading system supplier of a large range of innovative ground support systems such as pumpable injection chemicals, resin capsules, galvanized mesh, dynamic anchor systems and forepoling systems for Underground Mining and Tunnelling. DSI Underground develops, produces and supplies high-quality systems that are tailored to suit the individual requirements of its customers. DSI Underground uses the challenges of digitization and “the mine of the future” as an opportunity to ensure sustainability and growth through innovative ideas and concepts.

“With the world’s most extensive choice of ground support products and systems, the DSI Underground’s offering is highly complementary and enables us to deliver greater value and safety to our customers. The deal gives DSI Underground access to Sandvik’s substantial R&D, global service and sales network, complements our growing aftermarket business and strengthens our leadership in underground mining and tunneling”, says Henrik Ager, President of Sandvik Mining and Rock Solutions.

DSI Underground has approximately 2,000 employees. DSI Underground’s revenue for 2020 is expected to be about EUR 518 million (excluding the four joint ventures that are part of the acquisition) and an EBIT margin that to a certain extent will be dilutive to Sandvik Mining and Rock Solutions’ margin. The purchase price is approximately EUR 943 million on a cash and debt-free basis. The impact on Sandvik’s earnings per share will be slightly positive.

Michael Reich, CEO DSI Underground | Photo Credit: DSI Underground.

“We would like to thank Triton for all their efforts and support: they have invested and supported us in developing significant value-added measures, for example by streamlining our processes, by taking measures to increase sales, by successfully realigning our product development and by accelerating digitization and supporting our ESG initiatives. Now, we are opening a new chapter. We believe that we have a strong new industrial home in Sandvik, with good growth opportunities and strong product and geographic synergies. Sandvik’s strategy is to invest in strong businesses with good growth potential. DSI Underground fits very well with Sandvik Mining and Rock Solutions. With our knowledge of ground support technologies, we can add a valuable and complementary offering to Sandvik Mining and Rock Solutions. On the other hand, we will benefit from the knowledge of the new group and Sandvik’s global customer network. Our customers will continue to receive the products and services at the same high quality with the associated service. At the same time, we will be able to expand our global reach and combine our offering with Sandvik products and services – for the benefit of our customers. My colleagues at DSI Underground are looking very much forward to becoming part of Sandvik”, explains Michael Reich, CEO DSI Underground”.

The transaction is expected to close by mid-2021 and is subject to relevant regulatory approvals.

“We would like to thank the management team, the employees and all other stakeholders for their contributions to DSI Underground’s development. Triton has been the owner of DSI Underground for more than nine years and we view this as an appropriate time for an ownership change to an industrial owner. DSI Underground and Sandvik Group fit well together, and the combined business should have a good future. We look forward to continuing our investment activities, acting as a responsible owner and an agent of positive change in the businesses we partner with,” says Peder Prahl, Director of the General Partner to the Triton fund.

About DSI Underground
DSI Underground is the world’s leading supplier of ground support products, systems and solutions for the underground mining and tunnelling industry. We are present in 70 countries and employ over 2,000 people, including engineers and technical specialists with in-depth experience of the underground industry.

With market-leading brands covering everything from bolting systems through to injection chemicals and resin capsules, we reinforce mines, tunnels and underground structures, helping our customers advance underground, and advance towards their objectives – safer, faster and more efficiently than ever.

For further information: www.dsiunderground.com

About Sandvik Group
Sandvik is a high-tech and global engineering group offering products and services that enhance customer productivity, profitability and safety. We hold world-leading positions in selected areas – tools and tooling systems for metal cutting; equipment and tools, service and technical solutions for the mining industry and rock excavation within the construction industry; products in advanced stainless steels and special alloys as well as products for industrial heating.

In 2019, the Group had approximately 40,000 employees and revenues of about 100 billion SEK in more than 160 countries within continuing operations.

For further information: www.home.sandvik/en/ 

About Triton
Since its establishment in 1997, Triton has sponsored nine funds, focusing on businesses in the industrial, business services, consumer and health sectors. The Triton funds invest in and support the positive development of medium-sized businesses headquartered in Europe.

Triton seeks to contribute to the building of better businesses for the longer term. Triton and its executives wish to be agents of positive change towards sustainable operational improvements and growth.

The 45 companies currently in Triton’s portfolio have combined sales of around €18,2 billion and around 100,800 employees.

For further information: www.triton-partners.com

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