03.07.2018
DEUTZ AG DE0006305006
DGAP-Adhoc: DEUTZ AG: DEUTZ intends to withdraw from the DEUTZ Dalian joint venture and is negotiating new strategic alliances in China
DGAP-Ad-hoc: DEUTZ AG / Key word(s): Joint Venture/Strategic Company
Decision
DEUTZ AG: DEUTZ intends to withdraw from the DEUTZ Dalian joint venture and
is negotiating new strategic alliances in China
03-Jul-2018 / 18:06 CET/CEST
Disclosure of an inside information acc. to Article 17 MAR of the Regulation
(EU) No 596/2014, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.
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The Board of Management of DEUTZ AG decided today to fully withdraw from the
joint venture DEUTZ (Dalian) Engine Co., Ltd. ('DEUTZ Dalian') and to sell
its 50 per cent stake in the company to the joint venture partner FAW, after
DEUTZ AG and FAW reached a common understanding of the commercial key
aspects. The planned transaction is subject to the approval of the
Supervisory Board of DEUTZ AG and should be completed in the second half of
2018. Furthermore, talks on new alliances with major local partners in the
construction equipment and agricultural machinery industries have already
reached an advanced stage.
This year, DEUTZ expects proceeds of almost EUR10 million from the disposal
of the DEUTZ Dalian joint venture and from related licensing income. In the
first half of 2018, earnings are likely to be reduced by a sum in the high
single-digit or low double-digit millions of euros. However, the proceeds
from the disposal are expected to largely offset, if not exceed, this sum
over the course of 2018. Overall, the DEUTZ Dalian joint venture and its
sale are not expected to significantly impact on earnings this year.
As at 31 December 2017, DEUTZ Dalian (DDE) was included in the consolidated
financial statements at a carrying amount of EUR38.4 million. Of this total,
EUR15.5 million was attributable to positive exchange differences, which are
recognised in other comprehensive income and, in the event of disposal, are
reclassified to profit or loss. From a financial perspective, the remaining
carrying amount on the consolidated balance sheet - after reclassification
of the exchange differences to profit or loss - will thus be just under
EUR23 million. Back in April 2018, DEUTZ had announced that it was reviewing
the joint venture's carrying amounts. The resulting valuation adjustments,
which had been calculated in April to be in the range of EUR16 million to
EUR32 million, would - from a financial perspective - now be limited to
around EUR23 million following the implementation of the planned sale of the
DDE shares. Based on the information currently available, this will be the
size of the write-down of the joint venture's carrying amount in the DEUTZ
consolidated financial statements. It is currently anticipated that the
adjustments will also relate to prior periods to a significant extent. DEUTZ
will provide further details of the finalised valuation adjustments when
they are disclosed in the interim report for the first half of 2018, which
will be published on 2 August 2018.
Contact:
Christian Krupp
Head of Finance, Investor & Public Relations
Tel.: +49 (0)221 822-5400
Fax: +49 (0)221 822-15-5401
E-Mail: [email protected]
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03-Jul-2018 CET/CEST The DGAP Distribution Services include Regulatory
Announcements, Financial/Corporate News and Press Releases.
Archive at www.dgap.de
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Language: English
Company: DEUTZ AG
Ottostraße 1
51149 Köln (Porz-Eil)
Germany
Phone: +49 (0)221 822 0
Fax: +49 (0)221 822 3525
E-mail: [email protected]
Internet: www.deutz.com
ISIN: DE0006305006
WKN: 630500
Indices: SDAX
Listed: Regulated Market in Dusseldorf, Frankfurt (Prime
Standard); Regulated Unofficial Market in Berlin, Hamburg,
Hanover, Munich, Stuttgart, Tradegate Exchange
End of Announcement DGAP News Service
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701341 03-Jul-2018 CET/CEST
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