As part of its efforts to further concentrate on its core business of manufacturing fibres, Lenzing AG has agreed to sell 85% of its shareholding in plastics business (Lenzing Plastics GmbH) to an Austrian bidding consortium led by Invest AG, the investment company of the Raiffeisen Banking Group Upper Austria based in Linz.

The valuation amounts to almost eight times the company’s 2012 operating profit - in the 2012 financial year Lenzing Plastics generated total sales of EUR 109.4 million and an EBITDA of EUR 11.2 million. This decision was preceded by a multi-stage bidding process in which the new owner proved to the best bidder.

“For strategic reasons Lenzing aims to increasingly focus on its core fibre business, which currently already accounts for 90% of consolidated sales. With this change of ownership we will enable the excellent company Lenzing Plastics to grow further and optimally exploit business opportunities under a new and experienced industrial owner,” says Lenzing’s Chief Executive Officer Peter Untersperger in justifying the decision to dispose of the company. “Moreover, the present consortium comprises a stable, Austrian solution featuring a responsible owner.”

Lenzing says it will maintain an interest in Lenzing Plastics as a minority shareholder, which underlines its ongoing connection to the company, whose production operations have been located at the Lenzing site for decades. Lenzing Plastics will continue to make use of infrastructure services provided by Lenzing AG.

“We see outstanding future and development potential in this high-tech Upper Austrian company  and consider Lenzing AG to be an excellent partner to further develop the company”, says Heinrich Schaller, Chief Executive Officer of Raiffeisenlandesbank Upper Austria.

Invest AG currently has approximately EUR 150 million invested, consisting of about 25 stakes in Austria and Southern Germany. It will support Lenzing Plastics with equity capital and contribute its experience in growth financing. The consortium, in which Invest AG holds a 30% stake, also includes OÖ Beteiligungsgesellschaft m.b.H. & Co OG (18%) and Tyrol Equity AG (30%).

Johann Huber, the current Managing Director of Lenzing Plastics GmbH, and Christian Reisinger, who was previously a longstanding Member of the Management Board of Lenzing AG, also belong to the consortium (jointly owning 7%). “We are convinced that we will be able to accompany Lenzing Plastics jointly into a promising future thanks to our successful and experienced team,” Heinrich Schaller adds.

The sale of Lenzing Plastics is subject to approval by the corporate bodies as well as anti-trust authorities. The closing of the transaction is expected at the end of the second or beginning of the third quarter of 2013.

www.lenzing.com