Rheinmetall, the German engineering group, has confirmed that it is in partnership talks with T&N to take control of Kolbenschmidt, the pistons and bearings maker T&N has been pursuing since 1994.
Last week Rheinmetall acquired a 24.99% stake in Kolbenschmidt previously held on behalf of T&N by Commerzbank. T&N holds options over a further 24.99% through Germany’s Metallbank. This stake has still to be approved by the German cartel office.
Rheinmetall wants to take management control of Kolbenschmidt by the year end in order to expand its automotive components business. `An alliance with T&N is our first choice in reaching this goal,’ said a spokesman.
Control of Kolbenschmidt, with annual sales of DM1.3bn (£481m), would give T&N and Rheinmetall leadership in the world pistons market, ousting rival German firm Mahle.
Rheinmetall’s main automotive component business, Pierburg, had a turnover of DM1.2bn last year. The stake in Kolbenschmidt and steady expansion of this holding is expected to increase salesto around DM2.8bn-3.3bn, with pre-tax profit of DM100m.
A link with T&N, a leading manufacturer in pistons and engine management systems, would fit in with Rheinmetall’s globalisation strategy.