Trelleborg: £35 million in Mitas synergies

In an interview published by the Trelleborg Group today, company president and chief executive officer Peter Nilsson has shared that, according to Trelleborg’s own assessment, its acquisition of Mitas parent company the CGS Holding will result in synergies of around SEK 400 million (£34.8 million) up to 2020. “These are mainly cost synergies, but also a great deal of sales synergies,” he added. “The estimate could be conservative and is based on how the market looks today. If there is a rise in demand, then sales synergies, above all, will increase.”

Commenting on the reasoning behind acquiring a company so heavily involved in the currently depressed agricultural sector, Nilsson said that even if Trelleborg works to gain cost synergies with all the companies it acquires, it doesn’t “maximise this work fully” within companies that operate on depressed markets. “We take a more long-term view of this and must be sure that we can handle a future rise in demand. Because we know that it will eventually turn around.” He added that Trelleborg doesn’t know when the agricultural market will turn around, however “we must be prepared when it does.” And: “We prefer of course to buy a company on a market that is close to the bottom than one that it is close to its peak.”