SWEDISH wholesaler G & L Beijer is to become a Toshiba heating and air conditioning distributor in 11 European countries.
In a further move to increase their refrigeration and air conditioning distribution across Europe, G & L Beijer AB and Carrier Corporation have signed a letter of intent to appoint G & L Beijer as the distributor of Toshiba brand residential and light commercial heating, ventilation and air conditioning products.
Carrier's Toshiba brand distribution operations comprise sales in 11 European markets: Germany, France, Spain, Portugal, Italy, Sweden, Finland, Poland and the three Baltic States. The distribution rights in these countries will be exclusive, and the assets related to these operations, along with approximately 160 employees, will be transferred to G & L Beijer.
As part of this transaction, Carrier will transfer employees and contribute existing assets related to the distribution of Toshiba brand hvac products to G & L Beijer in exchange for a cash amount equal to nine times annualised EBIT. In the trailing 12 month period ending Q1, 2011, Carrier's Toshiba brand distribution operations in these countries had approximately 160 employees, sales of approximately EUR 130M (SEK 1,200M) and EBIT of approximately EUR 10M (SEK 93M). The final EBIT is subject to due diligence confirmation and mutual agreement between the two parties.
The Toshiba brand distribution operations will be maintained as a standalone operational division within G & L Beijer separate from the Beijer Refrigeration operations. Carrier Corporation, through its joint venture with Toshiba Corporation, has exclusive distribution rights outside of Japan for Toshiba brand hvac products manufactured by the joint venture.
Joen Magnusson, CEO of G & L Beijer said: 'For G & L Beijer, this is a strategic opportunity from several aspects. Air conditioning and heat pumps are priority growth areas, which are driven by an increased requirement for energy savings and greater consideration for the environment. G & L Beijer can bring its distribution capabilities to significantly enhance Toshiba sales while benefiting from expansion and diversification of its portfolio.'
Carrier Corporation, which is G & L Beijer’s largest individual shareholder with 41.4 per cent of capital and 33.3 per cent of votes, has two representatives on the G & L Beijer Board of Directors. The transaction is, therefore, classified as a related-party transaction and the Board Members who represent Carrier are not participating in the Board of Directors’ review and approval of the transaction. In addition, G & L Beijer will obtain a fairness opinion relating to the transaction.