Michelin announced that it intends to acquire all outstanding shares of Sascar, a Brazilian digital fleet management and freight security company.
The São Paulo-based company, which has 870 employees, generated revenue of BRL 280 million ($125 million) in 2013 and has enjoyed average growth of 16 percent over the past three years. The company has developed a presence in the independent trucker and small truck fleet segment in Brazil.
"Michelin will benefit from the client base and technical and marketing skills built up by Sascar in the rapidly expanding telematics market for professional truck fleets and thereby accelerate the development of services for its customers worldwide", said Jean-Dominique Senard, CEO of the Michelin Group. "This will help us strengthen an important area of growth for the group."
The acquisition of this company, which has 33,000 fleets managed and 190,000 trucks in Brazil, will enable Michelin to expand its service offering for truckers and to speed the growth of its truck tire business in Brazil.
By joining the Michelin Group, Sascar will gain access to its major customers in South America.
The enterprise value, which stands at BRL 1.6 billion ($719.2 million), includes the purchase price of BRL 1.353 billion ($608.2 million) and BRL 247 million ($111 million) in debt, These amounts will be adjusted when the acquisition closes.
The acquisition is subject to approval from the Brazilian competition authorities