In light of shifting demand, U. K.- based Aggreko (AGK-l) has sold its European rental business to Atlas Copco and acquired the assets of Cummins (CMI-n) rental business in India.
Aggreko, which focuses on supply of temporary power, temperature control and oil-free air compressors, sold its European (Oil-Free Air) OFA rental business for US$18 million.
“Aggreko’s business is a perfect fit with our specialty rental division as they serve similar market segments and applications, broadening our customer base in Europe,” said Ronnie Leten, business area president of Atlas Copco Compressor Technique, in a press release.
The deal will add 200 compressors and dryers to Atlas Copco’s European fleet.
Rupert Soames, Aggreko’s chief executive notes that Oil-Free Air is one of the company’s smallest product groups.
“While we have a large and successful OFA rental business in North America in which we will continue to invest, we do not believe that our European OFA business has the scale to warrant further investment,” he said in a statement.
In addition to selling its European assets, Aggreko has shifted its focus towards the rapidly developing markets in India.
Aggreko is buying Cummins India, for $7.3 million, payable in cash on completion of the deal.
“Our investment in India means we will have achieved one of our strategic objectives, which is to have operations in each of the four largest developing economies in the world (the others being Brazil, Russia and China),” Soames said.
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