Metso strengthening presence in China
Company aiming to capture significant share of fast-growing Chinese construction market
METSO are to strengthen their presence in the fast-growing Chinese construction market through two strategic actions: establishing a joint venture with LiuGong Group Corp. Ltd and acquiring 75% ownership of Shaorui Heavy Industries Ltd.
Metso and LiuGong will form a 50-50 joint venture to develop the track-mounted crushing and screening business in China. The joint venture will combine Metso’s know-how in track-mounted crushing and screening with LiuGong’s extensive distribution resources (around 900 outlets) and manufacturing capabilities in China.
The initial scope of the joint venture will cover the design and manufacture of localized versions of Metso’s Lokotrack 1000 series mobile crushers and screens, although the range may be further expanded in the future. The products will be sold under dual branding: Metso LiuGong.
The joint venture company will also promote Metso’s global track-mounted crushing and screening equipment in China, but the deal will have no effect on Metso’s existing distributor network in other parts of the world.
In the other strategic move, Metso are to acquire 75% of Shaorui Heavy Industries Ltd – one of the leading mid-market crushing and screening equipment producers in China – and will have an option to purchase the remaining 25% of the company in the future.
The acquisition will provide access to the Chinese mid-market and provide a good platform for future growth by combining Metso’s premium product offering with Shaorui’s excellence in mid-market products.
‘China is a very important market for us, and we want to be part of the future development of the fast-growing construction market,’ said Andrew Benko (pictured), president of Metso Mining and Construction.
‘The joint venture with LiuGong offers us an opportunity to enter the crushing and screening mobile equipment market in China together with a well-known partner, and by acquiring 75% of Shaorui, we will gain deeper knowledge about the mid-market customers and products that will benefit us in many ways.
‘In the longer term, both of these investments will naturally grow the installed base of Metso crushers in China providing future service potential.’
