Sweden's Volvo sells stake in engine maker Deutz

[kscarbel2]

Reuters  /  July 7, 2017

Sweden's AB Volvo said on Friday it had sold its 25 percent stake in German diesel engine maker Deutz AG as the truck maker continued to trim assets outside its core business.

Volvo said in a statement that proceeds from the sale, which was carried out through a bookbuilding process, amounted to 1.9 billion Swedish crowns ($225 million) and would generate a capital gain of about 350 million crowns.

As part of a push to boost profits at the sprawling group, Volvo has been shedding peripheral businesses in recent years. Among them, it sold its external IT operations and a portfolio of properties last year and expects to sell its largely military Governmental Sales unit later this year.

Volvo said the capital gain from the divestment of shares in Deutz would be booked in the third quarter. The truck maker reports second-quarter results on July 19.

[kscarbel2]

Volvo Group sells its shares in Deutz

Volvo Group Press Release  /  July 6, 2017

Volvo Group has today sold its complete holding in the German listed engine manufacturer Deutz AG. Divestment proceeds amount to SEK 1,897 M, corresponding to SEK 62.73 per share (EUR 6.50).

The sale will result in a capital gain of approximately SEK 350 M that will impact operating income in the third quarter of 2017.

Volvo Group has sold 30,246,582 shares, corresponding to 25% of total shares in Deutz.

The sale will have a positive impact on Group cash flow and the net financial position in the Industrial Operations in an amount of SEK 1,897 M.

The capital gain will be reported in the segment “Group functions and Other”.

 

[Red Horse]

So Kevin-was there ever any integration of Deutz into Volvo products-Construction equipment?

[kscarbel2]

Absolutely Bob, Volvo has been Deutz's largest customer in the construction segment.

Volvo and Deutz got together in 98. They jointly designed a 4-valve 7-litre engine, the first Deutz engine seriously created for vehicular use rather than general industrial applications. It was called the D7 and was fitted into many Volvo city buses. Then Volvo bought Nissan Diesel (UD) and discovered they were on the verge of launching an all-new modern 7-litre engine. Volvo then stopped using Deutz engines in vehicles and switched to the UD engine. They did continue buying Deutz engines for Volvo Construction Equipment (VCE).  But I think that's all going to change now, despite Volvo saying it will go on.

This is the beginning of the end of Deutz. It's entire portfolio is older engine technology, its customer base has declined and limited financing.

[Red Horse]

1 hour ago, kscarbel2 said:

Absolutely Bob, Volvo has been Deutz's largest customer in the construction segment.

Volvo and Deutz got together in 98. They jointly designed a 4-valve 7-litre engine, the first Deutz engine seriously created for vehicular use rather than general industrial applications. It was called the D7 and was fitted into many Volvo city buses. Then Volvo bought Nissan Diesel (UD) and discovered they were on the verge of launching an all-new modern 7-litre engine. Volvo then stopped using Deutz engines in vehicles and switched to the UD engine. They did continue buying Deutz engines for Volvo Construction Equipment (VCE).  But I think that's all going to change now, despite Volvo saying it will go on.

This is the beginning of the end of Deutz. It's entire portfolio is older engine technology, its customer base has declined and limited financing.

Thx Kev- my only experience with them was with various types of construction equipment-never had any inhouse, on highway stuff-in fact only Deutz I ever heard of on highway was when Diamond Reo (Osterlund) used them for a bit-easily recognizeable by the sloping hoods as they were air cooled. On a personal note, I had rented a boom lift to stain my house.  I'm up in the air one sunday morning and engine tone changes- I look down and machine is in a cloud of smoke-lower to ground, and go to shut off-nothing-keeps going.  Open engine compartment, pull hose off that goes to air cleaner and jam a rag in it-that killed it.    They replaced it next day with a 2.3 Ford powered unit and later told me it had a cracked ring and was pulling lube oil!

In any case hate to see another option bite the dust.

[HeavyGunner]

So does Deutz still make ag tractors or have they gone by the wayside as well?

[Dirtymilkman]

53 minutes ago, HeavyGunner said:

So does Deutz still make ag tractors or have they gone by the wayside as well?

I sure hope not. They absolutely ruined Allis Chalmers

[kscarbel2]

SAME Deutz-Fahr

http://www.deutz-fahr.com/

[41180]

Deutz made a good skidder motor a lot of loggers loved them in tree farmer and timber jack skidders back in the late 70s and 80s a lot quieter than the Detroit's and would last longer but more money when they broke  down. 

[kscarbel2]

Back in the day, the air-cooled Deutz in a construction application (e.g. Liebherr excavator) was a respected powerplant.

The newer water-cooled engines are good. But in year 2017, they are all dated.

Bobcat was using a lot of Deutz powerplants until they were sold by parent Ingersoll Rand to Korea's Doosan in 2007. Now they have Doosan engines. 

[Dirtymilkman]

3 hours ago, kscarbel2 said:

Back in the day, the air-cooled Deutz in a construction application (e.g. Liebherr excavator) was a respected powerplant.

The newer water-cooled engines are good. But in year 2017, they are all dated.

Bobcat was using a lot of Deutz powerplants until they were sold by parent Ingersoll Rand to Korea's Doosan in 2007. Now they have Doosan engines. 

My gehl skid steer has a liquid cooled deutz engine in it. The rep said it's an engine company deutz bought for their liquid cooled engines. Runs as smooth as a watch.