Orlando buys into rubber parts business

German turnaround investor Orlando Management has acquired SaarGummi, a global automotive supplier with sales of €290m.

Munich-based turnaround and restructuring specialist Orlando Management has agreed to acquire Saargummi, a manufacturing business supplying rubber parts to the automotive industry. The Germany-headquartered business was sold by RAF Saarberg, a wholly owned subsidiary of RAG Aktiengesellschaft, the energy group.

Financial details of the deal have not been disclosed. Saargummi, which has production facilities in Europe as well as the Americas, has 3900 employees worldwide and last year generated a turnover of €290 million. 

A spokesperson for RAG Saarberg said in a statement that the deal would enable the vendor to focus on its core energy business.

According to the same statement, Orlando is committed to continue the restructuring process currently underway at Saargummi.

Georg Madersbacher, a managing partner at Orlando, said in an interview that Saargummi was a solid business where certain parts were performing better than others, making it an attractive target for Orlando to acquire.

Orlando will use equity to fund the transaction and assume Saargummi's existing debt, Madersbacher said.

The deal is subject to regulatory approval. For Orlando, which two years ago closed its debut fund on €163 million, it will be the sixth acquisition since its inception. The firm is building a portfolio of assets in Germany and Austria.