SGL acquires BMW's interest in carbon fibre jv


Germany’s SGL Carbon SE is acquiring BMW Group's 49% equity investment in the joint ventures SGL Automotive Carbon Fibers and SGL Automotive Carbon Fibers LLC (US) – together referred to as SGL ACF. Once the deal has been completed, SGL will be the sole owner of SGL ACF. As is customary, the transaction is subject to approval from the respective authorities.

In 2016, SGL ACF generated sales revenue of around EUR90 million.

"We are proud of the pioneering work that we have carried out with BMW Group on lightweight construction for the automotive sector. The carbon fibres made at our plant in Moses Lake and the fabrics that are produced from them at the Wackersdorf site have proven very successful. It is now time to fully integrate this expertise into SGL Group's value chain," says Jürgen Köhler, CEO of SGL Group.

Carbon fibres and carbon fibre materials are at the core of SGL Group's corporate strategy. By acquiring SGL ACF now, SGL says it is forging ahead with its strategy to consolidate all key activities in the value chain – from carbon fibres and materials to components – within the group, giving it overall responsibility. The company is also acquiring Benteler-SGL for the same reason.

The changes in the shareholder structure of SGL ACF will not have any direct impact on its workforce, which currently totals around 450 employees.

“BMW Group will continue to rely on lightweight construction and an intelligent mix of materials, with carbon remaining a significant component,” explains Markus Duesmann, member of the Board of Management at BMW AG with responsibility for purchasing and supplier network. Carbon will also play an important role in the BMW iNEXT, which will set the benchmark for electric vehicles, autonomous driving, connectivity, and lightweight construction from 2021.

“SGL Group is and will remain a major supplier and strategic partner in this regard,” adds Duesmann.

BMW Group has entered into an agreement with SGL to continue to work together on future projects involving the use of carbon

The existing supply agreements for the continued procurement of carbon products from SGL ACF for the BMW i3, the BMW i8, and the BMW 7 series into the next decade are unaffected by the transaction. Likewise, BMW Group's CFRP-stacks production unit in Wackersdorf will not be affected. Furthermore, the transaction will not impact BMW AG's 18.3% shareholding in SGL Carbon SE. This equity investment is not up for disposal.

The agreement between SGL Group and BMW Group provides for the acquisition of the two SGL ACF companies in stages. In the first step, SGL Automotive Carbon Fibers (Germany) will be transferred to SGL Group. This transaction will probably be completed in January 2018. The second step will involve SGL Automotive Carbon Fibers LLC (US) being transferred to SGL Group, with this transaction expected to be completed by the end of 2020 at the latest.

The SGL ACF joint venture was founded in 2009 with the aim of establishing the use of carbon as a lightweight construction material in the automotive industry and securing the supply of carbon fibres and fabrics for BMW Group. Since then, SGL Group and BMW Group have created a leading technological position in the field of carbon fibre composites with their joint development activities and the construction of two plants. The possibility of SGL Group acquiring BMW Group's shares was already agreed as an option back when the joint venture was founded. Accordingly, 51% of the shares were allocated to SGL Group and 49% to BMW Group at that time.

SGL ACF's production activities take place in Moses Lake (Washington, US) and Wackersdorf (Bavaria, Germany). Moses Lake is said to be the world's most modern and environmentally friendly carbon fibre plant and produces specific carbon fibres for serial production applications. The acquisition gives SGL Group the opportunity to expand its activities at the site relating to fibres and composites for the North American market.

At the Wackersdorf plant, carbon fibres are processed to create fabrics and non-wovens. BMW Group uses these to produce components, such as for the passenger cell of the i3 and i8, as well as individual parts for the 7 series. At the site, SGL ACF also operates equipment to recycle residual materials resulting from the production process, thereby making a valuable contribution to conserving resources and lowering costs in the carbon fibre-reinforced plastics process chain.

In the future, SGL ACF will be fully assigned to the Composites – Fibres & Materials (CFM) business unit. In parallel, SGL is establishing a Lightweight and Application Centre (LAC) in Meitingen (Bavaria, Germany). At the LAC, products and associated manufacturing processes are developed for lightweight components that are suitable for volume production.

In the future, the former joint venture Benteler-SGL will also belong to the CFM business unit. The company is one of the leading developers and large-scale producers of lightweight composite components (based on fibreglass and carbon fibres) for the automotive industry.

At the start of November, SGL Group announced that it was acquiring the other 50% of this joint venture from Benteler (subject to approval from the relevant authorities).


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