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AFG Arbonia-Forster-Holding strengthens the Group’s international operations

Acquisition of British company Aqualux, one of the UK’s largest suppliers of bath screens and shower enclosures – Additional access route into the Chinese market

(PresseBox) (Arbon, ) Switzerland’s AFG Arbonia-Forster Holding AG, Arbon – which operates in the Heating Technology and Sanitary Equipment, Kitchens and Refrigeration, Windows and Doors, Steel Technology, and Surface Technology sectors – has purchased British company Aqualux Products Holding Limited, Wednesbury, for CHF 51.9 million. Based near Birmingham, the company is one of the leading suppliers of sanitary ware in the UK, offering a wide range of bath screens, shower enclosures, shower trays and steam cabins. Aqualux employs about 190 staff and in 2006 generated sales of approximately CHF 68 million. The company’s strategic partnership with a similarly focused supplier in Huizhou, in the southern Chinese province of Guangdong, is a welcome addition to the presence that AFG is currently building up in the Chinese market. As a result of taking over Aqualux, the Heating Technology and Sanitary Equipment Division is raising the proportion of international sales generated outside its home markets from 30% to 37%. For the Group as a whole, the increase is from 27% to 30%.

Ever since AFG was taken over by its current majority shareholder Edgar Oehler, one of the company’s strategic goals has been to reduce dependence on its strong position in the two home markets of Switzerland and Germany. This objective applies especially to the Heating Technology and Sanitary Equipment Division, which is not only the Group’s largest division by far, contributing 46.6% of total Group sales, but which also supplies innovative products that enjoy strong international demand. By purchasing Aqualux, AFG has taken a major step towards implementing its international strategy. The acquisition also marks a significant move towards two of AFG’s other targets: strengthening and widening its range of sanitary equipment products, and improving its position in the wellness segment.

Strong market position in the United Kingdom and healthy international prospects

AFG also sees the acquisition of Aqualux Products Holding Limited as an important stage on the road to becoming one of Europe’s leading suppliers of sanitary equipment. Aqualux is market leader in the UK for bath screens, and is one of the country’s leading providers of shower enclosures. In recent years the British company has also managed to build up its position in the high-end product segment. Aqualux is currently one of the few suppliers in the UK that offers competitive product ranges across a broad price spectrum.

Aqualux has maintained a successful alliance with Chinese partner Multiway for several years. For the Heating Technology and Sanitary Equipment Division, as well as for AFG as a Group, this creates new opportunities to speed up the planned expansion of sanitary equipment business in Asia. There are also opportunities for similar growth in the markets of Eastern and South Eastern Europe. Measurable synergies Aqualux will continue to operate on the market independently and under its existing management. In overall management terms, the company will be integrated into the Heating Technology and Sanitary Equipment Division. Aqualux’s integration into AFG and the access this provides to Group resources will have positive effects on the British company’s marketing activities and will generate measurable synergy potential in purchasing, logistics, IT and research and development.