Hillenbrand has agreed to acquire processing equipment firm Coperion Capital for €408m.
Coperion makes compounding, extrusion and bulk material handling equipment for the food manufacturing sector, in addition to machinery for industries such plastics, chemicals, pharmaceuticals and aluminium.
The deal will strengthen the food portfolio of Hillenbrand, whose subsidiaries include K-Tron, Rotex and TerraSource Global, all of which make conveyors among other equipment used by the food industry.
At the completion of the transaction, Coperion, which will keep its headquarters in Stuttgart, Germany, would become the largest company in its Process Equipment Group, said Hillenbrand.
Coperion’s current chief executive Gunter Bachmann will continue as the firm’s president, reporting to Hillenbrand’s Joe Raver, president of the Process Equipment Group.
‘Highly respected company’
"Coperion is a highly respected company which is led by an exceptionally talented management team with extensive global experience," said Hillenbrand chief executive Kenneth Camp.
"This transaction will enable us to capitalize on several opportunities in combined equipment sales, accelerated global expansion, and leveraging of replacement parts and service capabilities.
“Post closing, the Process Equipment Group will generate revenue of more than $1bn and will represent about two thirds of Hillenbrand's total revenue."
"We are very familiar with Hillenbrand's Process Equipment Group operating companies, particularly K-Tron," said Bachmann.
"We're delighted to have the opportunity to join Hillenbrand and better serve our customers by solving all of their process equipment needs. We also are excited about the growth opportunities that now will be available to our combined company."
Hillenbrand expects to use a combination of cash on hand and cash available under its revolving credit facility to fund the acquisition.
The purchase is subject to regulatory approval and is expected to be completed in December.
Hillenbrand, which is based in Batesville, Indiana also owns coffin manufacturer Batesville.