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DSI restructures and confirms Jennmar deals 10 Nov 2016

DSI News Release

It has been a momentous 2016 for ground support systems business DSI with reorganisation of its construction and underground businesses into two separate divisions and international marketplace agreements with its business competitor and collaborator Jennmar of the USA.

Following announcements earlier in the year, DSI and Jennmar have agreed to rationalize areas of the working in which they compete. DSI has taken control of Jennmar businesses in Europe - in Spain, the Czech Republic, and Poland, and in Latin America - in Mexico, Chile and Peru, while it has sold to Jennmar its mining manufacturing assets in the United States.

In addition Jennmar has sold a 50% stake in its Chinese subsidiary Jennmar Asia to DSI to create Rocbolt Technologies (China), a move that joins the two other successful DSI-Jennmar joint ventures of Rocbolt Technologies (South Africa) and Rocbolt Resins (Australia).

At the time of the market rationalisation announcements in early 2016, Patrik Nolåker, Group CEO of DSI, said that “soft commodity prices and supply/demand imbalances represent important challenges to our customers in mining. Through acquisition of the Jennmar businesses in Europe and Latin America, DSI combines the strengths of two well established market players, allowing it to provide its customers a superior offering, both from an efficiency and a product and services portfolio perspective.”

Jennmar Executive Vice President Tony Calandra said that acquisition of the DSI mining assets in the USA will “further strengthen Jennmar’s position in this segment of the market due to DSI’s strong presence in western US hard rock mining. The acquired DSI activities in coal mining will complement Jennmar’s existing strong footprint in the sector.”

DSI had planned also to acquire Jennmar Australia but this was conditional on approval by the Australian anti-trust authority. This was not granted and the proposal has since been withdrawn. Both DSI and Jennmar will continue to provide Australian customers with their different ground support solutions and services.

Confirmation of the successful deals with Jennmar follows earlier reorganisation in 2016 of DSI into two separate operations for its construction and underground businesses. According to DSI the split allows the company to focus on integrating the Jennmar acquisitions into its underground division portfolio.

DSI Construction continues to trade under Dywidag Systems International or DSI and keeps the original company logo, while the underground business, now called DSI Underground, has a new DSI branded logo.

Michael Reich, current Chairman of DSI, is the new CEO of DSI Underground. Until September 2016, Patrik Nolåker was CEO of the DSI Group and leader of DSI Construction with Nick Moses, previously CFO of DSI, continues as CFO of the Group and of both new divisions in a shared role. In September, Nolåker left his role as Group CEO, but remains a member of the DSI Board. Until a new Group CEO is appointed, Moses, as Group CFO, will act as CEO of DSI Construction. Central company functions such as legal, finance, treasury, internal audit and marketing and communications will be shared between the two divisions for the time being.

“These leadership changes are a direct result of the Group’s reorganisation into DSI Construction and DSI Underground and their separate management teams,” said Matthew Turner, Chairman of the DSI Board. “This organisational change reflects the successful development of our businesses through profitable growth and accretive acquisitions and will further enhance their operational and strategic focus going forward."

References

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