Sulzer to Acquire Control of Rotec's Gas Turbine Service Business

WINTERTHUR, Switzerland (Dec. 1, 2016)—On Nov. 30, Sulzer signed an agreement to acquire control of Rotec’s gas turbine maintenance business (Rotec GT), according to a statement from Sulzer. Rotec GT, headquartered in Moscow and majority-controlled by Renova, is mainly active in the Russian market. Through this transaction, Sulzer becomes a sizable player in the Russian gas turbine service market with revenues of about $40 million, according to the company. Sulzer is buying control of the assets of Rotec GT, the gas turbine maintenance division of the Rotec group. Rotec GT has a refurbishment center for gas turbine components in Ekaterinburg. With around 50 employees, it achieved 2015 revenues of about $35 million and an earnings before interest, taxes, depreciation and amortization (EBITDA) margin of slightly above 20 percent, according to Sulzer’s statement. The other activities of the Rotec group—in steam turbine manufacturing and engineering, procurement and construction (EPC) projects—are not part of the transaction. Rotec GT will be combined with Sulzer Russia’s service activities to create a leading independent gas turbine service provider for Russia and the Commonwealth of Independent States (CIS) countries, with domestic revenues of about $40 million, according to the statement. Renova, the current majority owner of Rotec, will remain an investor with a 49 percent stake in the combined entity, which will be under the sole management control of Sulzer, according to the statement. The combined entity will operate under the Sulzer brand and will be fully consolidated by Sulzer. Daniel Bischofberger, president of Sulzer’s Rotating Equipment Services division, said, “Sulzer is excited to have Renova as a partner. Together we are taking our combined service business in Russia to the next level.”