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FTC approves Teco deal to buy Italian firm

FTC approves Teco deal to buy Italian firm

Taipei, Sept. 19 (CNA) The Fair Trade Commission (FTC) has issued a greenlight to allow Teco Electric & Machinery Co. (????), one of Taiwan's leading industrial motor suppliers, to acquire Italy-based Motovario S.p.A. In a statement, the FTC said that the acquisition planned by Teco is not expected to impose any adversary impact on market competition in Taiwan as buyers here have options to choose other industrial motor suppliers locally. At the end of July, Teco announced that it will buy a 100 percent stake in Motovario, an Italian power transmission system maker, for 186 million euros or about NT$6.5 billion (US$199 million). Founded in 1965, Motovario produces large gear reducers, motors and other power transmission products, with particular focus on worm gears for which it is a global player. The FTC said that as gear reducers Motovario specializes in making are the critical components Teco's industrial motors need, the combination is expected to create synergy for the Taiwanese suitor, while the Italian firm's products are expected to enrich Teco's product portfolio. The commission said that the overseas acquisition could extend Teco's reach, which is expected to help the company improve its services to its foreign clients in a bid to broaden its customer base. The FTC added that the deal also could help Teco make better use of its resources and cut production costs. Teco said that it expects the acquisition deal will be completed by the end of this year when the Taiwanese firm will start to include sales generated by the Italian company into its books. Motovario currently operates highly automated production facilities in Italy and Spain and also has 150 sales agents in 60 countries. In 2014, the firm greatly expanded its business by acquiring Pujol, a gear-reducer manufacturer based in Spain. In 2014, Motovario posted about NT$4 billion in sales and was profitable, according to Teco. The European market accounted for more than 50 percent of Motovario's total sales last year, while the Italian firm also shipped its products to other markets, including the United States, China and Indonesia, Teco said. Teco ranks as the third largest medium-voltage motor producer in the world, with about 8 percent of the global market. It is also the fifth largest supplier of low-voltage A/C motors, with a 4 percent market share. (By Chiu Po-sheng and Frances Huang)


Updated : 2021-09-25 08:46 GMT+08:00