Livingstone advises Tianjin Keyvia on its acquisition of Balfour Beatty

  • Sep 2016
  • Industrial
  • M&A: Buy-Side
  • Germany
  • Asia

Livingstone‘s Industrial sector team has advised Chinese Tianjin Keyvia Electric Ltd. (“Keyvia“), on the acquisition of 100% of the shares of Rail Power Systems GmbH (“RPS“), Munich. Prior to the acquisition the ultimate owner Balfour Beatty plc. had transferred its German rail technology business into RPS, with the roots of the business reaching back to AEG and ABB.

RPS is today one of the international leading suppliers of railway electrification and power supply systems und especially in the field of contact lines a leading provider of turnkey systems. Amongst the references are numerous well-known High-Speed lines in Europe and Asia. As it relates to railway power supply systems, RPS supplies technically leading AC- and DC-systems for metro and mainline applications in conjunction with a comprehensive project management. With around 700 employees the company achieved sales of appr. EUR 140 mill. in 2015.

Founded in 2000 Keyvia is also active in the railway electrification space. The Company offers DC-power supply systems but in addition power supervisory control and data acquisition systems, as well as traction power supply and video monitoring systems. In selected product groups the company has a market leading position in China. Since 2009 a Joint Venture for a DC-switchgear product range is operated in China with the predecessor of RPS.

In the year 2014 the company went public on the Shenzhen Stock Exchange, as a High Tech-company in the rail industry following an international growth strategy. The strategic logic of the acquisition by Keyvia is first the complementary product range in the space of railway electrification and power supply systems, the ability for a joint product development and the exploitation of sales synergies. Second Keyvia pursues the goal, based on the competitiveness of RPS in the design, planning and execution of contact line projects, to gain international and especially Chinese contact line projects.

In the mid-term Keyvia’s products will also be designed according to the requirements of European rail customers. The Sino-German transaction was of particular complexity, because due to the prior carve-out of RPS pro-forma-accounts were required by the Shenzhen Stock Exchange, a number of regulatory requirements and reports had to be filed as required for a major asset restructuring and finally the industry–specific project financing facilities had to be restructured with German and Chinese banks.

“Livingstone accompanied us closely in all relevant aspects of the transaction and they made an important contribution to the success of the transaction. The individual commitment and the reliability of the team alongside the ability to coordinate a large number of involved parties in the process, both in Germany and China, was outstanding“, said Xiang Zhou Kong, Chairman, and Wang Wei, General Manager, Tianjin Keyvia Electric Ltd.

“For us it was a great pleasure to act as Keyvia’s adviser, because we established a bond of trust and Livingstone was able to showcase that our integrated Sino-German team is able to manage a buyside-mandate of that size as a one-stop for our clients“, added Ralph Hagelgans, Partner at Livingstone Düsseldorf and Baoshan Bao, Managing Director of Livingstone China Ltd.

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