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Wolong Electric completes the acquisition of GE Industrial Small Motors
Wolong Electric Group Co., Ltd. (“Wolong Electric”; SHA: 600580) and General Electric Company (“GE”; NYSE:GE) have jointly signed closing documents and successfully completed Wolong Electric’s acquisition of GE’s mid- and low-voltage motor business (“SIM”) for $160 million in an all cash transaction. Effective as of the 30th of June 2018, GE SIM will officially become a pivotal part of Wolong Electric’s global business.
Wolong Electric (the Company) is a part of Wolong Holding Group Co., Ltd. (“the Group”), which is one of China's top 500 enterprises. Founded in 1984, the Group has more than 18,000 employees globally. In 2017, The Group had 4.4 billion USD in assets and reached 5.4 billion USD in revenue. The Company mainly focuses on the drives and motors businesses. Wolong’s products occupy leading positions in markets around the world, covering industrial automation, home appliances, electric vehicles, energy engineering, environmental engineering, shipbuilding industries. In recent years, Wolong has continued to focus on the core business of motor manufacturing. It has successively acquired European ATB Motor Group, Italian SIR Robotics Company and OLI Vibration Motor Company, as well as the domestic Nanyang Explosion-proof Motor. Wolong is committed to be a world-class, industry-leading, motor and holding company. Wolong's factory network has spread across Asia and Europe, with established R&D centers for motors and drive control in Europe and Japan, and has plans to set up a global R&D Center in Shanghai. These measures will help Wolong gain a leading position in market share, globally.
The acquisition of GE SIM includes the design, development, manufacture, sales and other business of low-voltage and TEFC medium-voltage motors below 1,750 horsepower. The assets mainly include 100% equity of General Electric Industrial Motors Mexico Corporation, 100% equity of General Electric Motor Services Corporation, and other entities involved in assets and employees related to this business.
A new legal entity Wolong Electric America LLC will be headquartered in Houston, Texas, USA, led by the current SIM leadership team. With its accumulated expertise in motor technology, first-class manufacturing technologies, as well as advanced management capabilities, modern process equipment, and a sound sales network in North America, SIM will become Wolong’s North American Business Center, providing high-quality GE-branded mid- and low- voltage motors for the global market. In addition, Wolong has also signed a 10-year Trademark License Agreement from the date of closing with General Electric, which allows Wolong to sell products manufactured in Monterrey, MX under the brand “GE Industrial Motors, a Wolong company” to the American market. In addition, this deal will expand SIM’s sales channels and sell SIM’s key products to the China and European markets. As with all acquisitions, Wolong envisages the whole being greater than the sum of its parts to reinforce Wolong’s global strategy. In the future, Wolong will invest in the brand to upgrade in areas of industrialization 4.0, digitalization and new product development. Wolong is committed to enhance brand value and product performance by maintaining synergy and consistency with the development trends of a world-class advanced technology company.
Wolong has accumulated rich experience in merges and acquisitions in the past ten years. Adhering to a basic strategy of keeping acquisitions “affordable, well-controlled, and well-managed”, Wolong has accumulated a set of mature models that successfully develop and harmonize acquired companies. In keeping the relatively independent operation of the local team, while incorporating coordination and command from Wolong Headquarters, both sides will share resources and learn from each other in sales, operations and technology development functions. Wolong seeks further common ground, while reserving differences to make progress together with acquisitions.
The GE electric motor business has a legendary history which goes back to the Edison era 130 years ago. Wolong and General Electric share a common vision, not only in creating higher value for industrial customers, but also in the role our companies play in creating a better future for broader society. Wolong firmly believes that through this cooperation we will further strengthen our core business, expand our global sales network, enhance global technical collaborative development, improve all levels of motor manufacturing, expand our motor service business, increase global market share, and consolidate Wolong's global leadership position in motor and drive control system technology.