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December 28, 2005

EQT buys MTU Friedrichshafen

Swedish-based private equity house EQT says its EQT IV fund has signed an agreement with DaimlerChrysler to acquire 100 percent of MTU Friedrichshafen GmbH including the off highway part of Detroit Diesel in the U.S.

Daimler Chrysler and EQT have agreed on an enterprise value of Euros 1.6 billion (about $1.9 billion). Taking into account cash, cash equivalents, debts and pensions, Daimler Chrysler will benefit from a cash inflow of estimated Euros 1.0 billion (about $1.18 billion). Daimler Chrysler says the transaction will affect it's operating profit by estimated Euros 0.4 billion (about $473 million), with net income rising by an estimated Euros 0.3 billion (about $355 million).

EQT, which says it has a strong track record of fostering growth and value creation in the 39 companies it has invested in over the last 10 years, says it plans to support MTU's international expansion plans. The acquisition is subject to approval from relevant competition authorities.

"We are committed to back MTU in their growth strategy. We at EQT are very glad that we were chosen as the new owner of MTU, and we want to help MTU to continue to prosper and be even more successful in the future," said Marcus Brennecke, Managing Partner of EQT Equity in Germany. "We are very much looking forward to working together with management and employees to develop the company's potential."

"With the sale to EQT, we are putting MTU Friedrichshafen on the right track for continued expansion," said Dr. Ruediger Grube, Member of the DaimlerChrysler Board of Management for Corporate Development. "As the prices under discussion with the three bidders were very similar, we decided in favor of the bidder with the most convincing concept."

The closing is expected to be completed within the first quarter of 2006

EQT will install a supervisory board with experienced industrialists from its network after the deal is completed

Friedrichshafen will remain the company's headquarters

EQT will invest in growth and market leadership

"The management is very satisfied that EQT has been chosen as the new owner of MTU. We are happy that EQT, with its industrial approach, encourages the management and its current strategy", said Volker Heuer, CEO of MTU. "The high willingness of EQT to invest will enable us to extend our technology leadership."

The acquisition of the MTU Group includes MTU GmbH, Friedrichshafen, and the off-highway arm of Detroit Diesel Corporation. The MTU Group's operations consists of diesel engines and complete drive and propulsion systems for ships, armored vehicles, decentralized power generation and further industrial applications. The MTU Group has annual sales of more than Euros 2 billion and employs over 7000 people worldwide.

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