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KPS Capital Partners to acquire Bosch foundation brakes business

Realignment of brake operations concluded


* Agreements signed with leading private equity firm
* Bosch to continue with brake control systems, brake boosters, and aftermarket businesses

Stuttgart – The Bosch Group is planning to sell its global foundation brakes business to a newly-formed affiliate of KPS Capital Partners, a leading global private equity firm based in New York City. Agreements to this effect have been signed on January 9, 2012. The transaction is subject to approval by the antitrust authorities. The planned sale comprises the original equipment business with products such as brake calipers, disk brakes, drum brakes, and parking brakes, with a total sales volume of 850 million euros in 2010. Some 5,200 associates work in this sector, around 30 of them in Germany.

“In selling our foundation brakes business to KPS Capital Partners, we have chosen a leading private equity firm with many years of experience in the industrial sector,” said Bernd Bohr, member of the Bosch board of management and chairman of the Automotive Group. This carve-out concludes the realignment of the brake operations of this global supplier of technology and services. Bosch had announced its intention to restructure its brake operations in spring 2009. This was followed at the end of 2009 by the sale of Bosch’s foundation brakes business in North America to the Japanese brake manufacturer Akebono Brake Industry, Tokyo. The remaining global foundation brakes business is to be transferred to KPS Capital Partners and its affiliates in spring 2012. It comprises 20 locations in Europe, Asia Pacific, and South America, of which 15 are manufacturing sites.

In the future, Bosch’s brake operations will be focused on brake boosters and brake control systems. Bosch will retain and systematically expand the aftermarket business, including production of brake disks and brake pads.

Michael Psaros, a KPS Managing Partner, said, “KPS is very excited to create one of the leading manufacturers of foundation brakes, building on our many years of experience investing in the automotive industry. In addition, the combination of the new Company’s customer relationships and knowledge base of its thousands of associates worldwide, together with the financial resources provided by KPS, will accelerate the Company’s growth as an independent enterprise.”

Martina Merz, Chief Executive Officer of the Foundation Brakes Business, said, “Our objective is to build a leading supplier of foundation brakes and I believe that the Company’s strong balance sheet and access to KPS’s financial resources will enable it to achieve that objective. I am very confident that by tailoring the business processes to foundation-related requirements and by continuing to leverage the skill, creativity and talent of our associates, the new Company will achieve its full potential.”

The Bosch Group is a leading global supplier of technology and services. In the areas of automotive and industrial technology, consumer goods, and building technology, some 285,000 associates generated sales of 47.3 billion euros in fiscal 2010. For 2011, the company forecasts sales of more than 50 billion euros and a headcount of a good 300,000 by the end of the year. The Bosch Group comprises Robert Bosch GmbH and its more than 350 subsidiaries and regional companies in over 60 countries. If its sales and service partners are included, then Bosch is represented in roughly 150 countries. This worldwide development, manufacturing, and sales network is the foundation for further growth. Bosch spent 3.8 billion euros for research and development in 2010, and applied for over 3,800 patents worldwide. With all its products and services, Bosch enhances the quality of life by providing solutions which are both innovative and beneficial.

The company was set up in Stuttgart in 1886 by Robert Bosch (1861-1942) as a “Workshop for Precision Mechanics and Electrical Engineering.” The special ownership structure of Robert Bosch GmbH guarantees the entrepreneurial freedom of the Bosch Group, making it possible for the company to plan over the long term and to undertake significant up-front investments in the safeguarding of its future. Ninety-two percent of the share capital of Robert Bosch GmbH is held by Robert Bosch Stiftung GmbH, a charitable foundation. The majority of voting rights are held by Robert Bosch Industrietreuhand KG, an industrial trust. The entrepreneurial ownership functions are carried out by the trust. The remaining shares are held by the Bosch family and by Robert Bosch GmbH.

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