Danish cable manufacturer NKT has acquired SolidAl, a power cables manufacturer based in Portugal, for €192m ($205m) from Njord Partners.
The deal will enhance NKT's medium and high-voltage production capabilities to meet the increasing demands from grid upgrades and renewable energy projects across Europe.
NKT is investing an additional €50m to expand capacity at SolidAl's existing facility 50km north of Porto.
The investment will bolster NKT's production footprint in southern Europe, improving its geographical reach in key markets such as France, the UK, Ireland, Spain and Portugal.
In the fiscal year 2023, SolidAl reported revenues of €150m and EBITDA [earnings before interest, taxation, depreciation and amortisation] of €20m.
NKT has identified potential synergies from the acquisition that are projected to enhance financial performance starting in 2025, with full realisation by the end of 2026.
The new production capacity will be operational by 2027, contributing to NKT's medium-term financial goals, including a return on capital employed (RoCE) above 20%.
SolidAl is expected to positively impact NKT's financial results from the date of closure.
NKT president and CEO Claes Westerlind stated: “SolidAl provides a strong strategic fit in terms of capacity and competence, strengthening NKT’s position in serving customers with end-to-end grid solutions, particularly the growing demand for medium and high-voltage power cables up to 225 kV.
“We look forward to welcoming SolidAl’s highly skilled employees to NKT and continuing our growth journey together.
“With more than 50 years in the industry, SolidAl will complement the competitiveness of the product mix from NKT’s existing factories in Asnaes, Velke Mezirici and Cologne focusing on delivering the full range of power cables for the grid at a larger scale.”
